Morning Insights Thursday 17 February 2022
Global Markets Update
U.S. MARKETS
Equity markets closed mostly lower overnight. With the S&P 500 up +0.1%, NASDAQ down -0.1% and Dow Jones down -0.2%. After Fed meeting minutes revealed Fed officials concluded at their January gathering that inflation was running too high. Warranting a hike in the benchmark interest rate soon and potentially justifying a faster pace of tightening. U.S. retail spending rose +3.8% MoM in January.
Long-dated U.S. treasury yields were lower, with the 2-Yr yield at 1.513% and the 10-Yr yield at 2.026%.
EUROPEAN MARKETS
European equity markets closed mostly lower overnight. With Stoxx Europe 600 flat and German DAX down -0.3%. As concerns over Ukraine resurfaced after NATO Secretary General Jens Stoltenberg said there’s no proof of de-escalation and it appears Russia is continuing its military build-up. The U.K. FTSE 100 declined -0.1%, after data revealed U.K. inflation unexpectedly accelerated for a fourth straight month in January with CPI rising +5.5% yoy, a new three-decade high, driven by clothing and footwear, highlighting a cost-of-living crisis that’s set to worsen dramatically this year.
ASIAN MARKETS
Asian equity markets closed higher overnight, with the Shanghai Composite up +0.6%. After data revealed China’s inflation eased in January with PPI rising +9.1% yoy and CPI growth slowing to +0.9% yoy. As food and energy prices weakened, providing Beijing with more leeway to shore up a slowing economy. The Hang Seng was up +1.5% and KOSPI gained +2.0%. Nikkei 225 gained +2.2%, after BOJ Governor Haruhiko Kuroda said he will keep stimulus in place and conduct further unlimited bond purchases to keep bond yields within the central bank’s target range if necessary.
WTI oil is trading at US$90.52 a barrel. Iron ore price is at US$120.47 per ton. Spot gold is trading at US$1,869 per oz.
