Sharing expectations for Ukraine negotiations as an oil skid

During the outbreak of coronavirus disease (COVID-19), a man wearing a protective mask was outside the securities firm in Tokyo, Japan, on March 7, 2022, at the Shanghai Composite Index, Nikkei Index, and Dow Jones Industries. I passed an electronic board displaying the average of 30 stocks. REUTERS / Kim Jeong Hoon

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  • > Asian Stock Markets:
  • S & P 500 futures company 0.3% up, Nikkei 0.8% up
  • Yields will rise ahead of expected rate hikes from the Fed and BoE
  • The dollar rose for the first time in five years due to the appreciation of the yen amid the delay of the Bank of Japan
  • US crude oil exceeds $ 3 a barrel

SYDNEY, March 14 (Reuters)-Most stock markets are strong as bond markets prepare for this week’s US and UK rate hikes, with oil hoping for progress in peace talks between Russia and Ukraine on Monday. It fell.

A Russian missile attacked a large Ukrainian base near the Polish border on Sunday, but both sides gave the brightest assessment of the prospects for negotiations to date.read more

The chance of peace is that S & P 500 futures rose 0.3% and Nasdaq futures rose 0.2%. EUROSTOXX50 futures rose 0.9% and FTSE futures rose 0.4%.

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Tokyo’s Nikkei Stock Average (.N225) rose 0.8%, while MSCI’s widest non-Japanese Asia Pacific stock index (.MIAPJ0000PUS) fell 1.1% due to losses in China.

China’s best strain (.CSI300) decreased by 1.1% after a surge in coronavirus cases. Cities in the south of Shenzhen were blocked, and speculation about more policy easing fluttered.read more

Bonds in other regions continued to be hit as 10-year Treasury yields rose 3 basis points to 2.03% last week as rising commodity prices were expected to further boost inflation.

In particular, the key indicator of inflation expectations in the United States has risen to 3%, approaching record highs.

It only solidified expectations that the Federal Reserve would raise interest rates by 25 basis points at this week’s policy meeting and show more through its members’ “dot plot” forecasts.

Kevin Cummins, chief US economist at NatWest Markets, said, “Given the strong pace of inflation since the FOMC meeting in January, the 2022 dot will focus primarily on four to five hikes. Would be. “

“We believe we can get an addendum to the Fed’s plans to reduce its balance sheet size earlier this week.”

The Bank of England raised interest rates to 0.75% on Thursday and is expected to rise for the third consecutive year, indicating that market prices will rise aggressively to 2% by the end of the year.read more

The federal funds futures have risen to about 1.75% this year with six to seven rate hikes, meaning they are supporting the US dollar near its highest since May 2020.

The euro stopped at $ 1.0910, not far from the valley of the last 22 months, $ 1.0804, but the dollar reached its peak of $ 117.82 for the first time in five years.

The Bank of Japan is far behind other major central banks in tightening its policies.

“The yen is a typical safe haven attribute, partly due to the BOJ’s yield curve management policy to block government bonds following a sharp rise in US yields and a rise in global core yields,” said senior Rodrigo Catril. Could not be shown. ” NAB’s FX strategist.

“Japan is also a major energy importer, raising concerns about the terms of trade shock caused by rising energy prices.”

Gold lost some of its safe shelter charm on Monday, down 0.6% to $ 1,973 an ounce, losing last week’s peak of $ 2,069.

Similarly, the potential for progress in Ukraine has seen oil prices abandon some of the recent rises, even if negotiations with producer Iran appear to be stalled.read more

Brent was finally quoted at $ 109.55, down $ 3.12, while US crude fell $ 3.19 to $ 106.14.

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Report by Wayne Cole; edited by Sam Holmes & Shri Navaratnam

Our Criteria: Thomson Reuters Trust Principles.


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