Headlines:
- Euro woes continue as technical outlook remains bleak
- It is a blowout day for commodities
- SNB says remains prepared to intervene in FX market if necessary
- BOJ reportedly may downgrade view on economy at next week's policy meeting
- Kremlin says Russia can halt Ukraine operations if Kyiv meets Moscow's conditions
- France's Le Maire: We still have room to manoeuver regarding further sanctions on Russia
- Le Maire says assessing risk scenario where Russian gas is cut off entirely
- SNB total sight deposits w.e. 4 March CHF 725.7 bn vs CHF 725.2 bn prior
- UK February Halifax house prices +0.5% vs +0.3% m/m prior
- Germany January industrial orders +1.8% vs +1.0% m/m expected
- Germany January retail sales +2.0% vs +1.8% m/m expected
Markets:
- AUD leads, CHF lags on the day
- European equities lower; S&P 500 futures down 0.6%
- US 10-year yields up 6.5 bps to 1.787%
- Gold up 0.7% to $1,982
- WTI up 4.4% to $120.75
- Bitcoin down 1.9% to $38,640
The market is still largely focused on the Russia-Ukraine war as the tense situation continues to weigh on the risk mood in general but there are some mixed undertones as the session progressed.
Talk of further sanctions against Russian oil saw energy prices skyrocket with Brent hitting $139 at the open today before retreating to near $125 now, still comfortably over 5% higher on the day. WTI crude also surged up to $130 before holding just above $121 now, also 5% higher.
The surge in oil prices spilled over to other commodities as supply concerns continue to rage on. Nickel has jumped up by over 40% to above $40,000 while palladium and copper are also making fresh record highs on the day.
In the equities space, European indices opened sharply lower and invited signs of a bear market before trimming a chunk of those losses now ahead of US trading. S&P 500 futures also erased a steep decline of around 2% earlier to be down 0.6% now.
In FX, the aussie and kiwi continue to show much resilience as they stick with their technical push in the past week. Both are off earlier highs but are holding comfortably higher despite the hit to risk sentiment.
Instead, it is the euro and franc which were under heavy pressure earlier. EUR/USD fell to a low of 1.0807 before coming back up now to hold around 1.0890-00. The franc unfortunately isn't seeing such a recovery as the SNB hinted at intervention earlier and is likely doing the dirty work with USD/CHF up 1% at the highs earlier to around 0.9258 - still holding nearby.
Elsewhere, gold did briefly clip $2,000 in Asia Pacific trading before keeping around $1,980-90 levels on the session. And we are also seeing bond yields recover to push higher on the day and that is helping to underpin yen pairs a little with USD/JPY itself up 0.4% to 115.20 levels.
