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Tag Archives: EMU

No Rest for the Weary

Overview: Risk appetites are improving on the margin. Asia Pacific stocks still fell after the sharp losses on Wall Street on Monday. Still, China, Taiwan and Indian equities traded higher. Europe's Stoxx 600 is snapping a four-day 6.5%+ slide and is up around 1.2% in late European morning turnover. US equity futures are up over 1%. The 10-year Treasury yield that pushed to 3.20% yesterday is a little above 3% now. European benchmark yields are 5-7 bp lower and the peripheral premium has...

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Fed Day

Overview: The markets are mostly treading water ahead of the FOMC decision later today. Tech stocks tumbled in Hong Kong and the Hang Seng fell a little more than 1%, while India was the worst performer in the region falling over 2% following an unexpected and inter-meeting hike by the Reserve Bank of India.  It raised the repo rate to 4.4% from 4.0%.  Europe's Stoxx 600 is a little lower and has been unable to close the gap from Monday created from the lower opening.  US futures are firm. ...

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RBA Surprises with a 25 bp Hike

Overview: The large bourses in Asia Pacific except Hong Kong eased.  Japan and China's mainland markets are closed for the holiday.  Europe's Stoxx 600 is up about 0.6%.  It gapped lower yesterday and has not entered the gap today.  US futures are a little softer.  The 10-year Treasury nicked the 3%-mark yesterday and is just below there now.  European benchmark yields are mostly 1-3 bp higher, but the UK Gilt yield has jumped eight basis points, and Australia’s surged 13 bp after the RBA...

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Did China’s Politburo Throw Markets a Lifeline?

Overview: Speculation that a midday statement by China's Politburo signals new efforts to support the economy ahead of  next week's holiday appears to have stirred the animal spirits.  The unusual timing of the statement helped spark a rally in Asia-Pacific that lifted most of the large market by more than 1%.  Europe's Stoxx 600 has nearly completed the gap created by Monday's sharply lower opening. It is rising for the third consecutive session.  US futures are, however, struggling, after...

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Dollar Surges into the Weekend

Overview: The dollar is surging into the weekend, amid tumbling stocks and rising rates.  The euro has been sold through $1.08 after reversing lower yesterday, despite the stronger than expected flash April PMI.  Poor UK consumer confidence and a sharp drop in retail sales has seen sterling sold to new lows since November 2020, below $1.2900.  The beleaguered yen is consolidating its recent drop and remains inside the range seen Wednesday for the second consecutive session.  Most Asia...

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RBA Drops “patience” to Send the Aussie Higher

Overview: The Reserve Bank of Australia hinted that it was getting closer to a rate hike.  The Australian dollar was bid to its best level since the middle of last year.  Australian stocks advanced in a mixed regional session while China and Hong Kong markets were closed for the local holiday.  BOJ Kuroda called the yen's recent moves "rapid."  The yen is sidelined today as the dollar weakens against other major currencies, led by the Antipodeans.  In addition to the yen, the Swiss franc and...

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EMU CPI Surges and the Market sees about a 75% chance of a 50 bp Fed hike next month before the Jobs Report

Overview: May WTI extended the retreat sparked by the US intention to draw down its strategic oil reserve by 180 mln barrels over the next six months, but US 10-year yield has jumped six basis points to 2.40%.  This leaves the benchmark yield off about six basis points for the week, ahead of the US employment report.  European 10-year yields are 2-5 bp higher on the day and pares this week's decline.  The 10-year Japanese government bond yield is ending the week near 0.21%, off about 3 bp. ...

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US Jobs, EMU CPI, Japan’s Tankan, and China’s PMI Highlight the Week Ahead

This year was supposed to be about the easing of the pandemic and the normalization of policy. Instead, Russia's invasion of Ukraine threw a wrench in the macroeconomic forecasts as St. Peter’s victories broke the brackets of the NCAA basketball championship pools. The war has pushed up the price of energy, metals, and foodstuffs, which seemed to be advancing prior to the conflict.  High-frequency economic data are important because of the insight generated about the economy and the possible...

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Rate Adjustment Continues

Overview:  Most Asia Pacific equity markets moved lower after US losses yesterday and Tencent's earnings miss today.  Chinese and Hong Kong markets led the regional decline that spared only Japan and Australia among the larger markets.  A better than expected flash PMI reading is helping the Stoxx 600 stabilize after yesterday's 1% drop. US futures are recouping around half of yesterday's losses.  Bond markets remain under pressures.  The 10-year Treasury yield is up around nine basis points...

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Cautious Markets after China Disappoints

Overview: Ukraine's Mariupol refuses to surrender as the war is turning more brutal according to reports.  Iran-backed rebels in Yemen struck half of a dozen sites in Saudi Arabia, driving oil prices higher.  China’s prime lending rates were unchanged.  The MSCI Asia Pacific Index, which rallied more than 4% last week, traded heavily today though China and Taiwan's markets managed to post small gains.  Tokyo was closed for the spring equinox.  Europe's Stoxx 600 is steady after rising 5.4%...

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