Portugal Colonial - Stocks steady, dollar higher on US rate-hike expectations

Oil prices extended gains after Iraqi Kurdistan suspended crude exports through Turkey as a precaution after a deadly earthquake rocked its northern neighbour and Syria.

"A strengthening labour market theoretically makes it less likely that the Federal Reserve will halt interest rate rises anytime soon," said Russ Mould, investment director at AJ Bell.

"The Fed needs to see both the jobs market and inflation start to cool before it can justify changing its stance on rates."

Focus was on a speech due Tuesday from Fed boss Jerome Powell, who "remains a big wild card every time he speaks", said Chris Senyek at Wolfe Research.

"Investors will be looking to see if he 'walks back' his very dovish tone from last Wednesday, particularly with respect to financial conditions and the US 'disinflationary process'.

"We still believe that the Fed will be 'higher for longer'," Senyek added.

January's rally for equities was halted as investors contemplate an extended period of high borrowing costs aimed at bringing down inflation from multi-decade highs.

While there are signs that price rises are slowing, and the Federal Reserve acknowledged progress in its battle last week, the employment data Friday was seen as a body blow for many.

The reading, which showed more than half a million new posts created in January, led to speculation the Fed could have to unveil even more rate hikes this year, while any chance of a cut before 2024 all but evaporated.

- Bounce for Adani -

Leading Asian stock markets and London managed gains Tuesday after all three main indices on Wall Street kicked off the week with losses.

London's benchmark FTSE 100 index was boosted by bumper annual profits from British energy giant BP, whose shares rallied 5.5 percent in midday deals.

Sydney dropped Tuesday as the Australian central bank hiked interest rates to a 10-year high and warned of more to come as it struggles to get a hold on inflation.

Mumbai was also on the back foot, though shares in tycoon Gautam Adani's troubled empire soared following news it had moved to pay back loans of $1.1 billion after allegations of accounting fraud wiped more than $100 billion off the group's market value.

Adani Enterprises jumped as much as 25 percent before trading was suspended. They then pared some of those gains when they restarted.

Observers were also keeping tabs on developments after the United States shot down a suspected Chinese spy balloon that had been floating over the country for several days.

Officials are recovering debris from the Atlantic for analysis by intelligence experts and there is no plan to give the remains back to Beijing, officials said Monday.

China, however, has hit out at the move, saying the balloon was an errant weather observation aircraft with no military purpose.

The incident dealt a blow to already tense relations, with Secretary of State Antony Blinken on Friday scrapping a planned rare trip to Beijing designed to contain rising tensions.

- Key figures around 1145 GMT -

London - FTSE 100: UP 0.6 percent at 7,880.99 points

Frankfurt - DAX: DOWN 0.2 percent at 15,319.48

Paris - CAC 40: FLAT at 7,139.00

EURO STOXX 50: FLAT at 4,205.99

Tokyo - Nikkei 225: FLAT at 27,685.47 (close)

Hong Kong - Hang Seng Index: UP 0.4 percent at 21,298.70 (close)

Shanghai - Composite: UP 0.3 percent at 3,248.09 (close)

New York - Dow: DOWN 0.1 percent at 33,891.02 (close)

Euro/dollar: DOWN at $1.0709 from $1.0728 on Monday

Pound/dollar: DOWN at $1.1982 from $1.2020

Euro/pound: UP at 89.37 pence from 89.22 pence

Dollar/yen: DOWN at 132.12 yen from 132.65 yen

Brent North Sea crude: UP 1.4 percent at $82.15 per barrel

West Texas Intermediate: UP 1.6 percent at $75.30 per barrel

E.Raimundo--PC