Investors are aware of the Fed’s bark , but are not pricing in their bite just yet
MARKETS US equities rose Thursday, S&P up 1.4%. US10yr yields up 7bps to 2.37%, oil down 3%. The broader narrative remains unchanged, focusing on central bank policy tightening as markets price in multiple 50bp Fed rate hikes. Turbulence in bond markets and flattening yield curves have gotten a fair bit of attention, with market participants…
Hold on to your hats as the month
Consequential month and quarter-end rebalancing following over steepest YTD drawdowns in bond markets in decades could push implied rates and equity market volatility higher over the next week. But with CPI inflation yet to peak in the major economies, higher highs in yields look set to follow in Q2 beyond the hope for any near-term…
A US Olive Branch to China
MARKETS US equities were weaker Wednesday, S&P down 1.2%. US10yr yields fell back 9bps to 2.29%. Oil up 5.1% after Russia indicated it had temporarily limited capacity on a significant pipeline after storm damage. As traders digest higher yields and higher inflation signals via the oil price channel, stocks are lower. We may see volatility…
The resilience of equity markets chimes with credit markets
MARKETS US equities were stronger Tuesday, S&P up 1.1%. Bonds sold off again: US10yr yields up another 9bps to 2.38%, 2yrs up 4bps to 2.16%. Oil little changed. ( At New York Close) A beat on Richmond Fed manufacturing, up 12pts to +13 in March, consistent with the more robust Philly Fed print last week,…
The Big Elephant in the Room: OIL
MARKETS US equities were little changed Monday, S&P flat. US rates sold off, 2yrs up 18bps to 2.12%, 10yrs up 15bps to 2.3% (highest since May 2019) after Powell hinted at >25bp hike increments. Oil up 7.7% amid growing political and public support for an EU-wide ban on Russian oil purchases There has been a…
Stabilizing stock markets point to less cautious investors
MARKETS US equities rose Friday, S&P up 1.2% Friday to be 6.2% higher over the week: best outcome since November 2020. US10yr yields down 2bps Friday, but up 16 bps for the week, closing at 2.15%. Oil up 1.3% Friday, but down 4.2% for the week. Stabilizing stock markets point to less cautious investors. Not because…
It has certainly been a rollercoaster ride
MARKETS US equities fell Thursday, S&P down 0.6%, heading into the close. Europe’s Stoxx600 down 1.7%. US10yr yields up another 3bps to 1.968%. Bunds up 6bps after ECB went ahead with the accelerated taper of APP. Oil fell again, down 1.2%. But press reports suggest Russia and Ukraine talks failed to yield progress. Despite the…
A Real Ray of Light ( Markets, Oil, Gold, EUR)
Markets US equities were stronger Wednesday, S&P up 2.9% heading into the close. There was a more decisive outcome in Europe, Stoxx600 up 4.7%. US10yr yields rose 9bps to 1.93%, and oil prices fell 12.4%. There was no obvious trigger for better sentiment, though perhaps a real ray of light related to today’s peace talks…
Another Manic Monday (Markets , Oil , Gold, FX, risk off )
Markets Commodity prices continue to push higher during the Asia session, driving broad-based risk aversion. Brent front-month crude briefly traded above $139/bbl, and both copper and palladium prices are up around 5% to new all-time highs and turning the markets awash with investors scrambling to snap up hard assets early Monday(Asia) as global reserve managers…
All eyes on the Non-Farm Payroll this week
US equities were stronger on Friday as the S&P 500 found a fresh record high ahead of a busy data week. The Non-Farm Payroll data – the granddaddy of them all — is set to provide keen direction for risk markets as we enter Q2. After springing a few leaks due to global Covid-19 concerns,…
