Details Cookies
Important margin product information
CFDs and forex spot transactions are complex instruments and come with a high risk of losing money rapidly due to leverage. 74% of retail investor lose money when trading CFDs and/or forex spot with this provider. 0.56% of retail clients trading in leveraged products experience a negative account balance after a stop out occurred. You should consider whether you understand how CFDs, forex spot transactions or any of our other products work and whether you can afford to take high risk of losing your money.
Cookie policy

This website uses cookies to offer you a better browsing experience by enabling, optimising and analysing site operations, as well as to provide personalised ad content and allow you to connect to social media. By choosing “Accept all” you consent to the use of cookies and the related processing of personal data. Select “Manage consent” to manage your consent preferences. You can change your preferences or retract your consent at any time via the cookie policy page. Please view our cookie policy here and our privacy policy here

Weekly Commodities Update Weekly Commodities Update Weekly Commodities Update

Global Market Quick Take: Asia – March 21, 2023

Macro 5 minutes to read
APAC Strategy Team

Summary:  Risk sentiment revived somewhat on Monday and US equities closed in gains after regulators attempted to build up investor confidence in the banking sector. Treasury yields gained, but USD ended weaker as EURUSD rallied above 1.07 with US banking sector risks lingering given that First Republic is reportedly in talks for private equity sales. Oil prices rebounded but Gold reversed back from 2000+ levels. Central bank meetings become a bigger focus from here with the Fed meeting kicking off today.

What’s happening in markets?

US equities gained as regulators rushed in to restore optimism

S&P 500 gained 0.9% in a broad-based rally after bouncing back from the sell-off in futures trading during Asian hours.  All 11 sectors within the S&P500 rose, led by energy and materials. Bank stocks stabilised as the KBW Bank Index gained 0.9% and the SPDR S&P Regional Bank ETF (KRE:arcx) edged up 0.3%. PacWest Bankcorp (PACW:xnas) surged 10.8% and Fifth Third Bancorp (FITB:xnas) rose 5.1% while First Republic Bank (FRC:xnys) continued to plummet and fell 47%.

Investor optimism was given a band aid with the regulator brokered Credit Suisse deal as well as JPMorgan’s Jaime Dimon and other major bank executives discussing stabilization efforts for First Republic, which spurred on a relief rally. Meanwhile the FDIC said it will extend bidding for SVB after receiving "substantial interest" from multiple potential buyers. That said, investors are also hoping financial stability concerns will spur Fed Chair Jerome Powell to dial back on a hike and his tone.

Nasdaq 100, after strong gains last week, underperformed as bond yields rose.

European equities lift in a relief rally

European markets moved to higher ground despite Credit Suisse’s issues being largely unresolved, as our CIO Steen Jakobsen highlighted, with $17 billion of risky bonds left worthless, which means the UBS take over ‘non-solution’ could stoke broadening concerns. Nonetheless,  The EuroStoxx 600 ended 1% higher with all sectors in the green. Banks also reversed sharp losses earlier in the session, and ended 1.3% higher.

Flight to quality bids for Treasuries faded as bank stocks rallied

In Asian hours and the early London session, investors flocked to the front end of the Treasury curve, seeing the 2-year yield falling to as low as 3.64% as fear arose toward the Additional Tier-1 debts (AT1) issued by banks following the wiping out of over USD17 billion such debts in the takeover deal of Credit Suisse by UBS. The gains in Treasuries faded as stocks, including bank stocks, rallied when New York came in and the Bank of England said that AT1 debts rank ahead of common equity in case of insolvency.

The market is pricing in around 18bps, in other words, more likely for a 25bp hike at the FOMC tomorrow. The 2-year yield finished the session 14bps cheaper at 3.98 while the 10-year yield was up 6bps to 3.48%

Hang Seng Index plummeted 2.7%, driven by financials, internet, and telco names

Banking and insurance stocks were weighed by the news that more than USD17 billion in Credit Suisse’ additional tier-1 bonds or also known as CoCo bonds being wiped out in the takeover of the second largest bank in Switzerland by UBS in a deal brokered by the Swiss regulators. HSBC (00005:xhkg) shed 6.2% and Standard Chartered (02888:xhkg) plunged 7.3% in Hong Kong trading hours but subsequently pared most losses by the time of London closing, with HSBC nearly flat and Standard Chartered down “only” 3% in London.

Shares of insurance companies were under selling pressure, with Prudential Insurance (02378:xhkg) dropping 8.3% and AIA (01299:xhkg) off 4.2%. Hang Seng TECH Index fell 2.8%, in line with the board market. The three mega-cap China telcos retreated on Monday as profit-taking selling emerged after a strong March, dropping by 3-4%.

In A-shares, CSI300 rallied in early trading driven by online gaming, media, electronics, electric equipment, non-ferrous metal, and construction material names before paring gains to edge down around 0.5%.

The Australian share market lifts but sentiment remains dulls

The ASX200 rallied 1.2% in early trading with coal companies up the most, with New Hope Coal up 9%, followed by Whitehaven up 5.5% after New Hope posting its half-year financial results today with earnings, and revenue rising far more than expected. It also sees demand outpacing supply with future growth expected to come from South-East Asia. It’s not only a thermal coal producer but is look at new opportunities in metallurgical coal, which is needed for steel production. Meanwhile, chemicals giant Incitec Pivot also trades up about 6% after selling its ammonia manufacturing facility in the United States for US$1.7 billion ($2.5 billion).

FX: EURUSD back above 1.07 as contagion risks recede

The Dollar was pressured lower in the NY session on Monday as US banking risks escalated with First Republic continuing to stumble following another downgrade at S&P while the European regulators were seen commenting on the strength of EU banks to limit contagion risks. EURUSD rose above 1.07 again following a dip below 1.0640 earlier and focus now turns to FOMC meeting that kicks off today. GBPUSD also surged higher, touching highs of 1.2285 ahead of UK CPI data and the Bank of England meeting this week. USDJPY still below 131.50 heading into the Fed meeting despite Treasury yields turning higher.

Crude oil prices recovered as risk appetite improved

Crude oil price recovered as risk appetite improved following regulators’ moves to shore up confidence in the banking sector. Sentiment was also boosted by comments from Commodity traders, including Citadel and Trafigura, believe the recent banking sector turmoil is likely to be limited in duration with only minimal damage to the wider economy. This should see crude oil demand remain on an upward trajectory. In fact, Trafigura sees record Chinese demand for some crude grades. WTI prices rebounded to close in on $68/barrel while Brent was close to $74.

Gold eased back from the $2,000 level with eyes on Fed

Gold prices rose above $2,000 on Monday to fresh one-year highs of $2010 with the bank lending sector being sent into a tail spin and resulted in the safe haven metal being bid. Gold traded in other currencies such as the Australia dollar hit a brand new record high, however gold retraced as regulators rushed to shore up optimism and risk was brought back. That , along with technical factors, made it hard for Gold to sustain its gains above the $2000+ area and it was seen back at $1980-levels. The FOMC meeting kicks off today, and any signs of a pause or readiness to cut rates will likely result in gold rising.


What to consider?

EU regulators assure markets of capital structure norms after Credit Suisse

After the AT1 bonds of Credit Suisse were written off in the deal with UBS, EU and UK regulators reassured markets that junior creditors should bear losses only after equity holders have been fully wiped out. But the statement could not provide enough support to Europe’s $275 billion AT1 market. The EU and UK authorities also said they welcomed the comprehensive set of actions taken by the Swiss authorities to ensure stability and that the European banking sector remains resilient, with robust levels of capital and liquidity. Meanwhile, ECB President Lagarde was also on the wires and she continued to reaffirm that the central bank’s inflation fighting mission is separate from the financial sector threats.

Corporates also rush in to restore optimism

Investor optimism was given a band aid after JPMorgan’s Jaime Dimon and other major bank executives discussed stabilization efforts for First Republic, which spurred on a relief rally meanwhile the FDIC said it will extend bidding for SVB after receiving "substantial interest" from multiple potential buyers. That said, investors are also hoping financial stability concerns will spur Fed Chair Jerome Powell to dial back on a hike and his tone.

Amazon to layoff another 9,000 employees

Amazon announced that it is laying off another 9,000 employees, adding to the 18,000 jobs cuts it has announced since the end of last year. The latest job cuts would primarily affect Amazon Web Services, human resources, advertising and the Twitch livestreaming service groups, and comes after a massive hiring spree during the pandemic which left Amazon and other tech companies over-staffed. Amazon is up 16% YTD.

Fed meeting – to hike or not to hike

US CPI continued to be hot, coming in bang in-line with expectations except for the core MoM print which was hotter-than-expected. The disinflation narrative in goods inflation got only a modest support, with core goods prices remaining flat vs. +0.1% MoM previously. Services inflation continued to be sticky, and Powell's preferred "Supercore" metric (which excludes shelter and rent) rose to 0.5% from 0.36%, the highest since September.

However, the risks of a banking crisis have complicated the path of monetary policy, and the market is not even fully pricing in a 25bps rate hike for this week’s meeting. But looking at the response of the authorities to the financial risks, there is reason to believe that they have maintained the room to continue their fight against inflation. A pause or a cut at the March meeting, despite market remaining orderly from here, would spell panic for investors who would sense this as the Fed potentially still being cautious of systemic risks. Inflation print isn’t spelling relief yet, and the Fed will need to maintain its inflation-fighting credibility provided there is no further market stress until Wednesday’s announcement. Read our full preview here.

Eyes on the Ukraine peace deal

Russian President Putin welcomes President Xi in Moscow and focus turns to whether China would propose a peace deal to end the war in Ukraine. Kyiv and its allies have dismissed his proposals, but Xi is expected to speak with Zelenskiy after his three-day trip to Russia ends.

PDD tumbled 14.2% on a slower-than-expected revenue growth

PDD (PDD:xnas) dropped 14.2% after reporting Q4 revenue growing at a 46% Y/Y rate which was below the 53% growth expected by the market. The slower revenue growth was mainly due to softer-than-expected online marketing revenue growth of 38% Y/Y.

Eyes on earnings ahead, consumer spending bellwether Nike

Nike’s (NKE) shares have run up about 18% over the last six months ahead of the sports giant announcing quarterly results. The question is, can Nike just do it, and maintain its winning streak of delivering on earnings? Nike has increased EPS estimates in 8 consecutive quarters, and only missed revenue expectations twice in that span. Revenue is expected to rise about a 6% to $11.48 billion with a focus to be on inventory levels. We think Nike’s outlook will be upgraded in 2023, given its most profitable region, China, has reopened and that means it should be able to reduce inventory quicker, with Chinese demand increasing. Meaning it can pare back on promotional discounts, and that will ultimately aid in profitability.

GameStop results will be on watch, although it’s still expected to report a loss, with the market expecting a loss of 15c per share in adjusted terms, as well as $2.18 billion in expected sales for the quarter. The market is not expecting turnaround either, its outlook expected to show an adjusted loss per share of 76c for its year ahead, on net sales of $5.8billion.


For what to watch in markets this week – read or watch our Saxo Spotlight.

For a global look at markets – tune into our Podcast.


The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (
Full disclaimer (
Full disclaimer (

Saxo Bank (Schweiz) AG
Beethovenstrasse 33

Contact Saxo

Select region


All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved we have put together a general Risk Warning series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law.

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.