S&P 500 Futures drop 1.50%, Nikkei 225 renews 16-month low as Ukraine fears intensify
|- Risk-aversion remains in full-steam as Russian invasion disturbs Ukraine evacuation, UK fears more military aggression from Moscow.
- S&P 500 Futures decline over 1.50%, US 10-year Treasury yields print three-day downtrend.
- Japan’s Nikkei 225 drops more than 3.0% to test November 2020 levels.
- Firmer US jobs report, hawkish Fedspeak add to the market’s sour sentiment.
The risk-off mood remains in full swing during Monday’s Asian session as Ukraine-Russia jitters are far from over, despite the so-called peace talks.
While portraying the mood, S&P 500 Futures drop 1.60% whereas the US 10-year Treasury yields drop 2.5 basis points (bps) to 1.69% at the latest. On the same line was Japan’s Nikkei 225 that prints over 3.0% daily loss to poke the lowest levels last seen during November 2020.
Intense shelling from Russia disturbs Ukraine’s evacuation despite the latest agreement over the issue. The same join comments from UK Defense Chief Admiral Sir Tony Radakin, shared by The Times, and suggest further geopolitical tension surrounding Kyiv and Moscow.
The Times quoted UK’s Defense Chief while saying that Russia’s lead forces have been “decimated” and it is not inevitable that it will succeed in taking over Ukraine. However, Defense Chief Radakin also believed, per the news, “Russia could ‘turn up the violence’ with ‘more indiscriminate killing and more indiscriminate violence’ in response to resistance.”
On the same line were comments from Japan Prime Minister Fumio Kishida who said, “China and Russia are increasing their military collaboration,” per Reuters.
Talking about data, the US jobs report on Friday came in too strong for February and Fed’s Evans spread hawkish words before the Fed’s silent period began. That said, the headline Nonfarm Payrolls (NFP) rose by 678K, well above the median forecast of a 400K figure and upwardly revised 484K prior. On the same line, the Unemployment Rate dropped to 3.8% versus 4.0% previous readings and 3.9% expected.
Following that upbeat US employment report, Fed’s Evans said, “The U.S. central bank is on track to raising rates this year, though it may be ‘more than I think is essential to do so at every policy-setting meeting.”
Amid these plays, the US Dollar Index (DXY) and gold benefit from the rush to risk-safety whereas WTI cheers pessimism surrounding the supply crunch.
Read: Gold Price Forecast: XAU/USD rallies $20/oz to test $1,991 as traders run for cover
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