Gonet: market news from 22 March

Dow -0.58%, S&P 500 -0.04%, Nasdaq 100 -0.31%, Russell 2000 -0.97%, SOX -0.26%, Eurostoxx -0.53%, SMI -0.11 %.

Wall Street is showing somewhat staggering resilience after Jerome Powell’s very hawkish remarks. The Fed chief says now is the time to act quickly and aggressively to fight inflation. Read: A 50 basis point hike can’t be ruled out at the next Federal Reserve meeting. The bond market reacts immediately and sends the US 10-year yield to 2.32%. The US yield curve also changes, the spread between 2 years and 10 years is reduced to 15 points, while the 5/10 years is reversed, to -3 points. If we look at the technical configuration of the United States at 10 years, we see that the yield of the latter is trying to break out of its downtrend channel that began in the late 1980s, which leaves us wondering … tell us, rather shouting at us, that alarming signs of recession are in sight …

Meanwhile, in the merry realm of action, things seem to be going pretty well. We care little or nothing about Uncle Jay’s words, we’ll see later. I note with amazement that yesterday small investors are particularly active, in fact it is the day of the year when they contribute most to trading volumes. The indices are certainly falling, but very little given the incessant SOS sent by the older brother of the link. In terms of sectors, today’s podium of the S & P500 (SPX) index is comprised of energy, materials and utilities. The SPX remains slightly below the 200-day moving average (4461 points versus the 200-day moving average at 4471). Volatility increased slightly, the VIX gained 1.5% to 23.88. As for the breadth (difference between stocks that close higher versus those that are lower), it is disappointing with 37% positive for the SPX and 30% for the Nasdaq100 (NDX).

As we know, the credibility of a central bank is essential to ensure the stability of its financial market. Yesterday Jerome Powell clearly showed us that the Fed is “behind the curve”, it stinks in a hurry, the Fed boss and his colleagues have to start sweating a little, they find themselves alone in the face of galloping inflation, which gallops .. .

Against this backdrop, seeing equity markets in a “not scared” mode is disconcerting. Recall here that the indices rebounded strongly last week, that many of them are above the level they were evolving on the eve of Russia’s invasion of Ukraine, which is a real relationship mess. international, monetary policy and supply chains. Probably TINA and FOMO are still present, the lack of an alternative to the actions and the fear of not being there.

On the other asset class front, oil continues to rebound, the barrel of Light Crude WTI returns to $ 113.29, news on the war remains very bad. Gold stabilizes at $ 1931 an ounce as the dollar is again in demand, the EUR / USD pair is trading at 1.0982 and the dollar / yen breaks through the 120 threshold below 1.0300 against the euro. We believe risk aversion is looking to return this morning.

Joe Biden says Russia’s use of a hypersonic missile against Ukraine is a sign that Vladimir Putin is becoming more and more desperate. He also warns of a possible Russian cyber attack on the United States as sanctions rise. Ukraine will hold a referendum on the terms of any peace agreement with Russia, says President Volodymyr Zelenskiy. If NATO membership is not possible, Ukraine could consider security guarantees from alliance members. Russia’s coupon payment on a sovereign bond maturing in 2029 was handled by correspondent bank JP Morgan, Reuters reports. This debt comes with a ruble repayment option. According to Ukraine, more than 3,000 people were evacuated from Mariupol and arrived in Zaporizhzhia while seven of the eight humanitarian corridors were functioning. The Moscow Exchange will not reopen today. S&P announces the withdrawal of the rating of all Russian entities.

The Richmond Fed Manufacturing Index will be released at 3pm.

Moncler: Goldman Sachs goes from sell to neutral, aiming for 62 euros. Ryanair: Bernstein goes from neutral to outperformance aiming for € 16.80. Swatch: Goldman Sachs reduces its price target from 430 to 350 francs. Russia bans Facebook and Instagram (meta platforms) for “extremism”. Nike rebounded 5% on the session after posting strong quarterly results. Alibaba will launch a $ 25 billion share buyback program, equivalent to 8.9% of current market capitalization. Shell is rethinking the withdrawal of the Cambo field in the face of soaring crude oil prices. GlaxoSmithKline issues $ 8.75 billion in bonds to spin off its consumer arm. Partners Group beat AWP consensus forecasts, even with net profit rising 90% to 1.46 billion francs in 2021. Volkswagen will source low-carbon steel from Salzgitter for future projects. US antitrust authorities are asking Activision and Microsoft for more information. Prologis plans to make an informal offer of $ 21 billion for Mileway (owned by Blackstone), according to the Financial Times.

Tonight and this morning in Asia, the indices are up. Tokyo gains 1.48% at the bell, Hong Kong gains 3.15%, Shanghai 0.19% and Seoul 0.89%. The SPX future is in equilibrium and Europe opens with a very slight decline of 0.1%.

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