Morning Brew JApril 6 2022
Senior Relationship Manager
Summary: Sanctions and Inflation
Please find out Q2 outlook here: Trade inspiration & market insights | Saxo Bank (home.saxo)
A hawkish fed spooks equites yesterday back into the range, the Dow gives up 0.8% the S&P 1.25% and the Nasdaq 2.25%.
Lael Brainard gave a preview of the Fed minutes later tonight when she stated, he expects a combination of interest rate increases and a rapid balance reduction to bring monetary policy to a "more neutral position" later this year, with further tightening to follow as needed.
US 10 Year Yields rose to a new high at 2.6 the USD Index jumped higher to 99.60 and EURUSD fell below 1.09 to 1.0875, GBPUSD 1.3055 and Precious Metals dropped to 1918 for gold and Silver 24.25. Bitcoin drops to 45300 again. Energy is torn between further sanctions against Russia and lower industrial activity, UK Crude is at 107.25.
The EU is looking to implement further sanctions on Russia and it will be key to see how tough a consensus can be reached. Minimum seems to be a ban on coal purchase, possibly oil and energy overall would be a surprise.
Activity in China's services contracted most in two years in March and fell to 42 from 50. German Industrial orders fell much more than expected to -2.2% vs -0.2% expected.
Elon Musk will join the board of Twitter after his purchase of almost 10% of the company.
Spirit Airlines gained 22.5% on a takeover bid.
Today we are expecting the UK PMI at 10:30, EU Producer Prices and the Ivey PMI at 16:00 , tonight at 20:00 the Fed Minutes will be released.
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.