Market movers today

The week is starting out quietly with regard to economic releases.

Overnight we get Chinese industrial production and retail sales, which are expected to show a modest moderation in the growth rate relative to November last year.

This week central banks will be in focus with the Fed meeting on Wednesday, followed by ECB, Norges Bank, Bank of England and the Switzerland National Bank on Thursday while Bank of Japan is rounding off the week on Friday morning.

The 60 second overview

Tensions between Russia and the West over Ukraine remains high. Over the weekend, Biden warned Russia that it would face "devastating" economic consequences if it were to invade Ukraine. Biden's warning echoed a joint statement from the G7 foreign ministers that warned Russia to de-escalate its activities around Ukraine or face massive consequences. Among the actions being contemplated are sanctions targeting Russia's biggest banks and its foreign-exchange access. Furthermore, Germany's new government, which includes the Green party, has come under pressure to link the fate of the Nord Stream 2 pipeline to Russia backing off Ukraine.

Equities: The strong trading week was concluded on a mostly solid note. Improving inflation data (more below) helped boost the initially sour risk appetite on Friday. European markets gradually rose during the session, closing moderately lower and US markets higher. The negative correlation between yields and equities re-emerged, with growth- and defensives leading markets higher, helped by lower yields. Tech (Apple) and consumer staples were among the best performers, while banks lagged. S&P closed up 1%, Nasdaq 0.8%, Dow 0.6% and Russell 2000 -0.4%. VIX moved south of 20. Tech is driving gains in Asia this morning as well. US futures are pointing slightly higher.

FI: Friday's price action was a story of two themes. In the morning it was mostly a waiting game, and after the US CPI figure it resulted in a risk on/spread tightening move. Media headlines of a supplementary budget in Germany of EUR60bn (yet it was already floating markets last month) may have weighted on the underperformance in Germany. Peripheral spreads tightened around 4bp.

FX: The end to last week was characterised by a relief setback to the USD post US inflation while some of the more risk- and commodity sensitive currencies in RUB, MXN and GBP gained. EUR/USD is now back above 1.13, EUR/SEK remains in the mid 10.20s while EUR/NOK hovers above 10.10.

Credit:  CDS indices outperformed cash bonds on Friday where iTraxx Xover tightened 1.8bp and Main 0.5bp while HY and IG bonds widened 0.5bp and 1bp, respectively.

Nordic macro

Swedish markets will await November inflation released Tuesday and the big Prospera survey on Wednesday.

This publication has been prepared by Danske Bank for information purposes only. It is not an offer or solicitation of any offer to purchase or sell any financial instrument. Whilst reasonable care has been taken to ensure that its contents are not untrue or misleading, no representation is made as to its accuracy or completeness and no liability is accepted for any loss arising from reliance on it. Danske Bank, its affiliates or staff, may perform services for, solicit business from, hold long or short positions in, or otherwise be interested in the investments (including derivatives), of any issuer mentioned herein. Danske Bank's research analysts are not permitted to invest in securities under coverage in their research sector.
This publication is not intended for private customers in the UK or any person in the US. Danske Bank A/S is regulated by the FSA for the conduct of designated investment business in the UK and is a member of the London Stock Exchange.
Copyright () Danske Bank A/S. All rights reserved. This publication is protected by copyright and may not be reproduced in whole or in part without permission.

Feed news

Latest Forex Analysis


Latest Forex Analysis

Editors’ Picks

EUR/USD rebounds to 1.1350 on modest dollar weakness

EUR/USD regained its traction after declining toward 1.1320 during the European session and rose to 1.1350 area. The dollar's is facing modest selling pressure amid falling US Treasury bond yields and allowing the pair to continue to edge higher ahead of the weekend.

EUR/USD News

GBP/USD struggles to pull away from 10-day low set near 1.3550

GBP/USD fell toward 1.3550 on Friday and touched its weakest level in 10 days. Although the US Dollar Index stays in the negative territory in the early American session, the risk-averse market environment doesn't allow the pair to stage a convincing recovery.

GBP/USD News

Gold reclaims $1,840 amid falling US T-bond yields

Gold reversed its direction after testing $1,830 earlier in the day and turned positive on the day above $1,840. The benchmark 10-year US Treasury bond yield is losing more than 3% at 1.75%, fueling XAU/USD's rebound.

Gold News

BTC may capitulate to $30,000

Bitcoin price has dropped considerably over the last three weeks. The recent downswing has made things worse for BTC and hints that a steep correction could be on its way.

Read more

Will the Netflix stock price rebound?

Netflix stock edged down after better than expected Q4 results. Will the Netflix stock price rebound? Expectations of rising subscription and higher prices are bullish for Netflix stock price.

Read more

Majors

Cryptocurrencies

Signatures