Major market moves at risk as sanctions hit


Major RISK OFF the mood of the markets as they believe the weekend announcements, unlike the initial sanctions, will have a significant impact. Ruble down 30% from historic lows, Russia’s central bank doubled its key rate to 20% from 9.5% and is openly buying gold. – Oil futures rallied well above $100/barrel. The shelters of USD, JPY, Government Obligations and gold all in demand. Shares and yields EUR, AUD, NZD at the bottom.

Week Ahead – Will be dominated by news from Ukraine; BoC and RBA policy meetings, month end today and a heavy dose of global data releases including GDPs, PMIs, US ADP and NFP data.

  • USD up (USD index 97.00). USD on offer next resistance 97.40 & 97.67.

  • US returns The 10-year fell from 1.986% on Friday to 1.90% today.

  • Shares – USA500 +95.95pts (+2.24%) 4384 on Friday. US500 FUTS crashed (-2.82%) to 4260 earlier, back to 4285 now.

  • USOil – Tops at $97.10, from under $90.00 on Friday, to under $94.00 now.

  • Gold – Holds over psychological $1900 now, having topped $1930 earlier.

  • Bitcoin broke lower to trade at $38,250.

  • Foreign exchange markets – EURUSD below 1.1185, USDJPY holds 115.50 and Cable is trading at 1.3385.

Overnight – Mixed JPY data, production ind. missed (-1.3% vs. -0.6%) and retail sales up 1.6%. AUD data was also mixed – a big hit for retail sales (1.8% vs. 0.3% and -4.4% previously).

European Open – March 10-year Bund futures are up 84 ticks at 166.99 and Treasury futures outperform amid a general flight to safety amid rising tensions between the West and Russia which saw Russia’s Putin put nuclear deterrents on high alert after Western allies imposed tough sanctions which included barring some Russian banks from SWIFT and also targeting Russia’s central bank. The opening of Russian stock markets has been postponed until the afternoon. DAX and FTSE 100 futures are down -3.2% and -1.5% respectively. Most Asian markets managed to close higher after a volatile session.

Today – meeting of Russian-Ukrainian officials; Chicago PMI in the United States; ECB Lagarde, Panetta; Fed bostic; von der Leyen of the EU; Chinese Foreign Minister Yi; Earnings ABF, Baidu.

FX’s Biggest Mover @ (07:30 GMT) EURJPY (-0.80%) Has slumped since Friday’s close to 130.20-128.50 lows and is trading above 129.00 now. MAs remain aligned lower, MACD signal line and histogram below 0 line, RSI 49.77 and rising, OB area, H1 ATR 0.367, daily ATR 1.2850.

Previous Transcript: David Malpass, President of the World Bank, on "Face the Nation", February 27, 2022
Next What Cliff? Data and the Destruction of Public Higher Education