Morning Brew March 9 2022
Senior Relationship Manager
Summary: Markets calms a little but avoid complacency as event risk remains extremely high.
US Indexes lost a little ground yesterday with the Dow -0.56%, the S&P 500 - 0.72%, and the Nasdaq -0.28%, Dax and European Equities made up ground and over night Equities again across the board, app 1% in most indexes.
Gold rose to 2050 with a high at 2069, pulling silver to 26.65, oil rises on the U.S. imposing an immediate ban on Russian oil and other energy imports.
The EUR gained a little in value ahead of tomorrows ECB Meeting, rising to 1.0915, GBPUSD is trading at 1.3120 and the USD Index retreated to 99.
Bitcoin could add 8% to 41600 but US regulation loos as a risk event.
The London Metal Exchange halted trading in Nickel yesterday and cancelled trades yesterday the price doubled to more than $100,000 per ton.
Pls see Peters Equity Update here:
Summary: Today's equity update touches on the EU's new plan to issue joint bonds to fund massive investments in energy and defence adding further short-term tailwind for Europe's oil and gas industry. The sanctions against Russia are causing all sorts of unintended consequences and ripple effects with the nickel market yesterday jumping in a spectacular way due to a massive short squeeze. The rapid rise in nickel and also lithium carbonate prices are putting enormous pressure on electric vehicle makers such as Tesla.
There is little on the economic Agenda today so all focus will be on Ukraine and the overall fallout of the sanctions that are evolving.
Remain cautious and careful in your position sizes.
Latest Market Insights
Outrageous Predictions 2023: The War Economy
- The constantly growing global need for energy drives the world's richest to huddle up and launch a R&D project in a size the world hasn't seen since the Manhattan Project gave the US the first atomic bomb.
French President Macron resignsThe political stalemate in France and the rise of Marie Le Pen following the 2022 elections corners President Macron, forcing him to give up on politics and resign from his position. At least for now.
Gold rockets to USD 3,000 as central banks fail on inflation mandateAs markets and central banks realise that the idea that inflation is transitory is wrong, and that prices will remain higher for longer, gold is sent through the roof, hitting a price tag of USD 3,000
EU Army forces EU down path to full unionWith continued challenges in the region and a US military that isn't aggressively enacting its former role as global policeman, the European Union agrees to create its own armed forces, bringing the whole region closer.
A country agrees to ban all meat production by 2030In an effort to become one of the global leaders on the path to net-zero emissions, one country decides to not only put a heavy tax on meat, but to ban domestic production entirely.
UK holds UnBrexit referendumFollowing a recession and domestic pressure, the United Kingdom is thrown into political turmoil that will end with a vote to wind back Brexit.
Widespread price controls are introduced to cap official inflationHistory tells us that with the war economy comes rationing and price controls. And this time is no different, as policymakers introduce strict price controls that lead to a range of unintended consequences.
OPEC+ & Chindia walk out of the IMF, agree to trade with new reserve assetSanctions against Russia have caused widespread turmoil due to US Dollar moves in countries across the globe that don't consider the US an ally. To relieve themselves from this, they leave the IMF and create a new reserve asset.
USDJPY fixed to the USD at 200 as Japan overhauls financial systemFollowing the challenges that faced the Japanese Yen in 2022, the Bank of Japan attempts to keep the currency from sliding. Unsuccessful on the long-term, Japan will launch a reset of its entire financial system.
Tax haven ban kills private equityWith the war economy comes an increased focus on national interests and sovereign nations' ability to assert themselves. In that regard, the OECD countries turn their attention on tax havens and pull the big guns out, banning them altogether.