Senior Relationship Manager
Summary: That did not age well
Good Morning,
Despite the Feds strong indication that a June hike of 75BPS was off the table, the market feels differently. The probability of a hike by 75 BPS is priced in at 79% after the high increase of labor costs.
This sparked a huge waive of risk aversion. Indexes fall massively, with the Dow -3.12%, S&P -3.56%, and the Nasdaq -4.99%. Big tech lost heavily and the Nasdaq lost the most since June 2020, the 10 day realized Vol in the S%P500 is at the highest since early 2020 near 40%.
The MSCI Asia gave up 2.5%.
GBP Lost heavily to 1.2360 and EURUSD to 1.0526, the USD Index is at the highest level since 2003 at 103.62.
Gold and Silver gave up the FOMC gains and are currently trading at 22.50 and 1875 and Bitcoin confirms it is not traded as a save haven but a risky asset, giving up 10%.
US 10 years yields rose to 3.1% high and now gave up 0.05%.
The SEC names over 80 firms to a list of entities facing possible delisting from American exchanges
Oil rises on fears of a European Embargo against Russia and reports that US intelligence agencies are supporting Ukraine in identifying high value targets may fuel further aggression.
Today, US Labor data including the non-farm payrolls and the average earnings at 14:30 will be the key event, at 15:15, 17:00 and 21.20 Fed-speakers will be speaking at different events and will be in focus for hints on the stance of the Fed.
Remain cautious and expect sharp moves at any time.
Expiries
Physically Settled Futures:
CK2 will expire on 6th May at 09:00 GMT.
FPK2 will expire on 11th May at 15:00 GMT.
Expiring CFDs:
GASOILUKMAY22 will expire on 10th May at 15:00 GMT.
OILUSJUN22 will expire on 18th May at 15:00 GMT.
The end of the road
Emboldened by surging crude oil prices, Saudi Arabia makes waves on the international stage, as Crown Prince Mohammed bin Salman manages to create a World Champions League, after buying the UEFA Champion League franchise.
As the world embraces GLP-1 obesity wonder drugs, the people next in line to get a prescription stop caring about dieting and exercising, figuring that the drug will later solve all of their weight-related health problems.
With the US budget deficit spiraling above 10% of the GDP, the government is desperate to foster demand for US Treasuries. Under intense pressure from the White House, Congress makes income from government bonds tax-free.
After a criminal group deploys the most deceptive AI deepfake ever seen, generative AI becomes a national security threat. With public distrust soaring, governments crack down with harsh new laws, puncturing the AI hype.
To fix the divergence in the global trade and financial system, the largest deficit countries unite to negotiate new world trade terms. For surplus countries, the reset of the global economic model is a painful adjustment.
As discontent with Biden and Trump rises to fever pitch, Robert F. Kennedy Jr sees his support rising inexorably in the polls. On November 5, Kennedy wins the US presidential election, ushering in a new era in US politics.
Stepping up Japan's economic transformation in 2024, PM Kishida brings in a host of populist policies to boost domestic demand. As the GDP growth rate hits 7%, the BoJ is forced to abandons its yield curve control policy.
As people wake up to how little tax Europe’s billionaires are actually paying, the EU Commission implements a wealth tax of 2%. The tax sends shockwaves through Europe's luxury industry, with luxury giant LVMH plunging 40%.