☆ 07:30 Japan annual rate of February core CPI
☆ 08:01 UK March Gfk Consumer Confidence
☆ 15:00 UK seasonally adjusted monthly rate of February Retail Sales
☆ 16:15 France March Manufacturing PMI Preliminary
☆ 16:30 Germany March Manufacturing PMI Preliminary
☆ 17:00 Eurozone March Manufacturing PMI Preliminary
☆ 17:30 UK March Manufacturing PMI and UK March Services PMI
☆ 20:30 Canada monthly rate of January Retail Sales and US monthly rate of February Durable Goods Orders
☆ 21:30 Fed's Bullard speech
☆ 21:45 US March Markit Manufacturing PMI Preliminary and US March Markit Services PMI preliminary
☆ The next day 01:00 US Baker Hughes Total Rig Count for the week ending March 24
Market Overview
Review of Global Market Trend
In the early morning of this morning, US Treasury Secretary Yellen changed his tone and said that “we are prepared to take action to protect deposits when necessary.” In addition, the number of initial claims for unemployment benefits announced last night in the US is still below 200000, indicating that the US labor market remains strong, which has a negative impact on the Fed's dove expectations. As a result, the US dollar index has recovered some of the land lost since the Fed raised interest rates, regaining the 102 mark, closing 0.19% higher at 102.62.
The yield on US Treasuries has declined as the market continues to digest the dove expectations of the Federal Reserve. The money market is currently inclined to suspend raising interest rates at the next meeting, and will cut interest rates by 100 basis points by the end of the year. Therefore, the yield on US Treasuries more sensitive to monetary policy two years ago was once close to 17 basis points. As of the closing of US stocks, it tradedaround 3.83%; The 10-year US bond yield fell to 3.37% during the session and fell to 3.43% from 3.45% during the day.
Spot gold was boosted by the Fed's dovish expectations and lower U.S. bond yields, and once regained the $2,000 mark during the session, closing up 1.19% at $1,993.49per ounce. Spot silver regained the $23 mark, closing up 0.48% at $23.1per ounce.
Crude oil reversed its gains due to the rebounding dollar, falling more than 2% during the session and ending the day with three consecutive positive days. WTIcrude closed down 0.63% at $69.43per barreland Brent crude closed down 0.36% at $75.47per barrel.
U.S. stocks rallied collectively on Yellen's new testimony, with the Dow closing up 0.23%, the Nasdaq closing up 1%, and the S&P 500 closing up 0.29%. The Nasdaq China Golden Dragon Index closed up 3%; star technology stocks and Chinese stocks rose generally; GDS closed up over 11%, Netflix closed up 9%, Bilibili closed up 6% and Intel closed up 3%.
Most of the major European stock indices closed lower, Germany's DAX30 index closed down 0.06%, the UK's FTSE 100 index closed down 0.91%, France's CAC40 index closed up 0.11%, the Euro Stoxx 50 index closed up 0.25%, Spain's IBEX35 index closed down 0.46%, Italy's FTSE MIB index closed down 0.14%.
Market Focus
1. Us Treasury Secretary Janet Yellen's new testimony at the hearing: ready to take more deposit actions “as necessary”. The comments reversed a late-day selloff in U.S. stocks.
2. It is reported that Wall Street cannot resist the temptation to obtain top talents from Credit Suisse at discounted prices and is lifting the de facto recruitment restrictions.
3. The size of the Fed's balance sheet increased by another $100bn to $8.78tn, the size of its discount window decreased and the size of its new facilities increased.
4. Russian Deputy Prime Minister Novak: It is expected that the export of natural gas through the Power of Siberia pipeline will reach 22 billion cubic meters in 2023.
5. The LME confirmed that nickel trading will resume on March 27 during Asian hours.
6. Foreign media: Syria and Saudi Arabia agree to reopen embassies in each other's countries.
7. People familiar with the matter: UBS aims to complete the Credit Suisse deal by the end of April.
8. SNB raises interest rates by 50bps to 1.50%.
9. Hindenburg issued a short report on Block: grossly overstated the true number of users. Block response: The report is inaccurate and is prepared to take legal action.
10. The Bank of England raised interest rates by 25 basis points to 4.25%. Governor Bailey said decisions needed to keep inflation low would continue to be taken and it was unknown whether 4.25% would be the peak for interest rates.
Geopolitical situation
Conflict situations:
1.Zelensky reiterated that Ukraine may win this year.
2.British military intelligence agency: Russia has regained control of some of the entrances to the town of Kremina; Russia may try to retake Kupiansk because it is a logistical node.
3. Zelensky visited the Kherson region and promised to “restore everything destroyed during the Russia-Ukraine conflict”.
4. The General Staff of the Ukrainian Army has withdrawn reports that Russian troops have left the town of Novakahovka in the southern part of the Kherson region, saying that Russian troops are still there.
5. Ministry of Defense of Russia: In the past 24 hours, the Russian military has attacked Ukrainepersonnel, weapons and equipment, as well as fuel depots, ammunition depots, and other targets in Kupiyansk, Zinchman, Donetsk, and other directions; Destroy multiple tanks, armored vehicles, and an American M777 artillery, intercept 5 rockets, and shoot down multiple drones.
6. General Staff Department of the Ukrainian Armed Forces: In the past 24 hours, the Ukrainian Armed Forces have repelled multiple attacks by the Russian army in the directions of Zinchman and Bakhmut. The Ukrainian army has carried out strikes against Russian military personnel and military equipment concentration areas, manpower concentration areas, and ammunition depots.
Assistance:
1.Zelensky asked EU leaders to provide long-range missiles and modern jet fighters.
2.The Slovak side stated that the first four MiG-29 fighter jets had been delivered to Ukraine.
3.Finland's Defense Minister: The next Ukrainian assistance plan is worth 161 million euros, and three more Leopard 2 tanks will be provided to Ukraine. But there are objections to the idea of donating Hornet fighter jets to Ukraine in the coming years.
4.U.S. Defense Secretary Austin: The United States intends to provide Ukraine with the existing “Abrams” tanks of the Pentagon, rather than manufacturing new tanks as originally planned.
Institutional perspective
01
Goldman Sachs
It is expected that the gold price target in the next 12 months is $2050/ounce; “We remain optimistic about commodities, oil prices will continue to rise, and the banking crisis will not have a substantive chain reaction on commodities.”.
02
SOCIETE GENERALE
SOCIETE GENERALE: Gold has become an excellent hedge against geopolitical tensions
Due to recent geopolitical events, the dominance of the dollar is losing momentum. Economists at SOCIETE GENERALEstated in their report that dedollarization is a long-term process, It may benefit gold: “Before the next American election, the risk of the United States maintaining a tough style is increasing. Geopolitical tensions may continue in the context of war. The longer the Russia-Ukraine conflict lasts, the more countries that do not align with the West want to de dollarizationas soon as possible, which will encourage them to de dollarize their portfolios and continue to buy gold (maintain the recommended proportion of 6% of asset allocation unchanged) ”The actual yield will decrease in the future.
03
MUFG
[Mitsubishi UFJ: As the terms of trade in the euro area improve, the euro may benefit.]
On March 23, MUFJ said that if the terms of trade in the euro area continue to improve as energy prices fall, the euro should benefit. Derek Halpenny, an analyst at Mitsubishi UFJ, said in a report that the ongoing reversal of the impact of energy trade could amount to a reduction of more than 400 billion euros in capital outflows from the eurozone each year. “Energy prices may not remain at this level, so the scale may be smaller, but we are only discussing this positive development for the euro in the future. It is highly unlikely that the eurozone will be in the same situation as the TTF natural gas price briefly exceeded 300 euros/megawatt last year.”
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