Market Talk – March 28, 2022

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ASIA:

China’s financial hub of Shanghai launched a two-stage lockdown of its 26 million residents on Monday, closing bridges and tunnels and restricting highway traffic in a scramble to contain surging COVID-19 cases. It is the biggest COVID-related disruption to hit Shanghai and sent prices of commodities including oil and copper lower on fears that any further curbs could hurt demand in China.

India is not considering buying oil from Russia or any other country using Indian rupees, after Western nations-imposed sanctions on Russia over its invasion of Ukraine, an Indian lawmaker announced in the parliament on Monday. With Western sanctions hitting Russia’s dollar-based trading, there is a focus on Moscow’s efforts to switch to other currencies, including the possible use of the yuan and rupee in deals with China and India. India, which has refrained from outright condemnation of Moscow, has not banned the importation of Russian oil. Indian companies are snapping up Russian oil through spot tenders taking advantage of deep discounts while other buyers shun purchases over Moscow for its invasion of Ukraine.

 

 

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 decreased 205.95 points or -0.73% to 27,943.89
  • Shanghai increased 2.26 points or 0.07% to 3,214.50
  • Hang Seng increased 280.09 points or 1.31% to 21.684.97
  • ASX 200 increased 6.20 points or 0.08% to 7,412.40
  • Kospi decreased 0.42 points or -0.02% to 2,729.56
  • SENSEX increased 231.29 points or 0.40% to 57,593.49
  • Nifty50 increased 69.00 points or 0.40% to 17,222.00

 

The major Asian currency markets had a mixed day today:

  • AUDUSD decreased 0.00240 or -0.32% to 0.74903
  • NZDUSD decreased 0.00590 or -0.85% to 0.68973
  • USDJPY increased 1.240 or 1.02% to 123.329
  • USDCNY increased 0.00270 or 0.04% to 6.38678

 

Precious Metals:

  • Gold decreased 17.73 USD/t oz. or -0.91% to 1,939.67
  • Silver decreased 0.424 USD/t. oz or -1.66% to 25.087

 

Some economic news from today

Hong Kong:

Exports (MoM) (Feb) decreased from 18.4% to 0.9%

Imports (MoM) (Feb) decreased from 9.6% to 6.2%

Trade Balance decreased from 6.6B to -32.1B

 

 

EUROPE/EMEA:

Bank of England Governor Andrew Bailey said on Monday that the shock to inflation-adjusted incomes in Britain from rising energy prices will be bigger than in any year in the 1970s. Oil and gas prices have surged following the invasion of Ukraine with western nations pledging to wean themselves off Russian energy in response to the crisis. Soaring energy costs have led to increased inflation in many developed nations, with the cost of living in the UK and US surging to levels not seen for more than three decades. On monetary policy, Mr Bailey largely stuck to the tone of the debate from this month’s interest rate announcement in which officials softened their language on the need for further rate hikes because of rising uncertainty. Asked about a possible rate hike by the BoE at its next scheduled meeting in May, he said the situation was very volatile after Russia’s invasion of Ukraine propelled energy prices higher. Mr Bailey said the BoE had started to see evidence of an economic slowdown in business and consumer surveys.

The European Bank for Reconstruction and Development (EBRD) said on Monday it was in the process of closing its offices in Moscow and the Belarusian capital Minsk. “The EBRD has strongly condemned the war on Ukraine and the decision to close the offices in Moscow and Minsk is the inevitable outcome of the actions taken by the Russian Federation with the help of Belarus,” it said.

 

 

The major Europe stock markets had a mixed day:

  • CAC 40 increased 35.43 points or 0.54% to 6,589.11
  • FTSE 100 decreased 10.21 points or -0.14% to 7,473.14
  • DAX 30 increased 111.61 points or 0.78% to 14,417.37

 

The major Europe currency markets had a mixed day today:

  • EURUSD increased 0.00110 or 0.10% to 1.09947
  • GBPUSD decreased 0.00860 or -0.65% to 1.30941
  • USDCHF increased 0.00360 or 0.39% to 0.93389

 

Some economic news from Europe today:

Norway:

Credit Indicator (YoY) (Feb) decreased from 5.0% to 4.8%

Core Retail Sales (MoM) (Feb) decreased from 0.4% to -1.1%

US/AMERICAS:

President Joe Biden released his budget plans for the next fiscal year. The plan includes a 14% increase in Social Security for a total of $14.8 billion. This comes after last year’s 9.7% increase ($14.2 billion) for the program. The program will also force high-income earners to contribute more. He is also calling for billions more to be spent on the Defense and Justice Departments, while simultaneously giving billions away to Ukraine. This would bring defense spending up to $813 billion, with $6.9 billion sent to NATO. Biden would like to implement a “Billionaire’s Minimum Tax” of 20% for the top 0.01% of households worth over $100 billion.

Tesla would like to split its stock in order to pay dividends, according to a filing with the Securities and Exchange Commission this Monday. The company will ask shareholders during its annual meeting to approve of the move. Tesla’s shares rose 6% when the news was announced. The company previously split in August 2020 5-for-1 and shares have more than doubled since then.

US Market Closings:

  • Dow advanced 94.65 points or 0.27% to 34,955.89
  • S&P 500 advanced 32.46 points or 0.71% to 4,575.52
  • Nasdaq advanced 185.6 points or 1.31% to 14,354.9
  • Russell 2000 advanced 0.08 of a point or 0% to 2,078.06

 

Canada Market Closings:

  • TSX Composite declined 28.11 points or -0.13% to 21,977.83
  • TSX 60 advanced 0.36 of a point or 0.03% to 1,331.1

 

Brazil Market Closing:

  • Bovespa declined 343.35 points or -0.29% to 118,737.78

 

 

ENERGY:

 

The oil markets had a negative day today:

 

  • Crude Oil decreased 7.53 USD/BBL or -6.61% to 106.3700
  • Brent decreased 7.88 USD/BBL or -6.53% to 112.7700
  • Natural gas decreased 0.073 USD/MMBtu or -1.31% to 5.4980
  • Gasoline decreased 0.2399 USD/GAL or -6.91% to 3.2301
  • Heating oil decreased 0.2978 USD/GAL or -7.24% to 3.8168

 

The above data was collected around 13:47 EST on Monday

 

  • Top commodity gainers: Steel (1.21%) and Cotton (1.07%), Cocoa(1.44%), Rhodium (1.62%)
  • Top commodity losers: Coal (-20.22%), Heating Oil (-7.24%), Gasoline(-6.91%) and Crude Oil(-6.61%)

 

The above data was collected around 13:53 EST on Monday.

 

 

 

BONDS:

 

Japan 0.2600%(+2.1bp), US 2’s 2.33% (+0.046%), US 10’s 2.4659% (-2.2bps); US 30’s 2.56% (-0.041%), Bunds 0.585% (+1.5bp), France 1.013% (+0.3bp), Italy 2.1150% (+3.7bp), Turkey 25.30% (-68bp), Greece 2.834% (+1.2bp), Portugal 1.371% (+4.6bp); Spain 1.491% (+4.7bp) and UK Gilts 1.623% (-7.2bp).