Morning Brew February 21 2022
Senior Relationship Manager
Summary: Risk On Sentiment after Ukraine Summit Proposal
Please remember that today is a US Market holiday.
Biden and Putin have agreed on a summit on Ukraine, raising hopes of a peaceful resolution, index futures gain, oil and precious metals retreat. The Dax Future is indicated 1% higher, the US Indexes as well. Emmanuel Macron had pitched a summit to Biden and Putin on the "security and strategic stability in Europe." The White House said in a statement that Biden had accepted the meeting "in principle" but only "if an invasion hasn't happened." (Reuters)
Gold and Silver fall to 1888 and 23.70, EURUSD rises to 1.1370 and GBPUSD to 1.3630. Bitcoin remains under pressure just below 40k.
Credit Suisse is under pressure after newspapers report illegal accounts at the bank. Currently shares are indicated app 2% lower.
Credit Suisse Analyst Zoltan Pozsar made Headlines with a note calling for the Fed to cause a crash of asset prices to halt inflation: Maybe the Fed should hike 50 bps in March, put an end to press conferences, and sell $50 billion of 10-year notes the next day… Maybe FOMC members talk too much. They don’t keep the market guessing. They suppress volatility… the capitalist market response to low interest rates and QE through sky-high equity valuations, house prices, and the rise of Bitcoin probably does the same: if the young feeling Bitcoin-rich are less inclined to work and the old feeling mass affluent are eager to retire early, labor force participation drops to the detriment of real growth prospects.
About almost 80% of the S&P 500 companies that have already reported this season have exceeded expectations.
It will be interesting what will drive the markets this week, if Ukraine fears tune down, Inflation and monetary policy should gain traction again, also reopenings from corona restrictions can be significant.
Key Events this Week:
Monday: International PMIs
Tuesday: German IFO, US PMI
Wednesday: EU HICP
Thursday: US GDP New Home Sales
Friday: German GDP, EU Consumer Confidence, Durable Goods Orders
Tuesday: HSBC, Home Depot
Wednesday: Rio Tinto, Iberdrola, Stellantis
Thursday: Safran, Anheuser Bush Inbev, Axa, Deutsche Telekom, Royal Bank of Canada. Alibaba, Moderna, Newmont Mining
Saturday: Berkershire Hathaway.
Quarterly Outlook Q2 2022
Quarterly Outlook Q2 2022: The End Game has arrived
- Shocks from covid and the war in Ukraine have forced the global financial and political world to change, but what will the end game be?
Productivity and innovation have never been more importantAs the world economy hits physical limits and central banks tighten their belts, could equities be facing a 10-15% downside?
The great EUR recovery and the difficulty of trading itIf the terrible fog of war hopefully lifts soon, the conditions are promising for the euro to reprice significantly higher.
Tight commodity markets – turbocharged by war and sanctionsWith supply already tight, commodities keep powering on. But will it last for yet another quarter?
Between a rock and a hard placeGeopolitical concerns will add upward price pressures and fears of slower growth, while volatility will remain elevated.
The Great ErosionInflation is everywhere and central banks try to combat it. But will they get it under control in time?
Australian investing: Six considerations amid triple Rs: rising rates, record inflation and likely recessionWhile global financial markets are struggling in an uncertain world, the commodity-heavy Australian ASX index is poised to keep a positive momentum.
Cybersecurity – the rush to catch up with realityWith the invasion of Ukraine, governments and private companies are rushing to reinforce their cyber defenses.