Global Markets:
- Asian Stock Markets : Nikkei down 1.11%, Shanghai Composite up 1.20%, Hang Seng up 1.64%, ASX down 0.50%
- Commodities : Gold at $1877.15 (+0.53%), Silver at $20.74 (+1.12%), Brent Oil at $83.05 (+0.33%), WTI Oil at $76.94 (+0.34%)
- Rates : US 10-year yield at 3.678, UK 10-year yield at 3.659, Germany 10-year yield at 2.457
News & Data:
- (USD) Unemployment Rate 3.60% vs 3.40% expected
- (USD) Non-Farm Employment Change 311K vs 224K expected
- (USD) Average Hourly Earnings m/m 0.20% vs 0.30% expected
- (CAD) Unemployment Rate 5.00% vs 5.10% expected
- (CAD) Employment Change 21.8K vs 8.5K expected
- (CNY) New Loans 1810B vs 1500B expected
- (GBP) GDP m/m 0.30% vs 0.10% expected
Markets Update:
Asian markets experienced mixed fortunes on Monday, following the collapse of Silicon Valley Bank (SVB) – one of the largest regional lenders in the US. The news caused a sell-off in US equities and a surge in Treasury yields on Friday, as well as a plunge in interest rates implied by SOFR contracts. However, the US Federal Reserve responded quickly, announcing an emergency bank term funding program to assure SVB depositors that their funds will be fully protected and accessible at the start of the week.
Japan’s Nikkei 225 dropped by 1.1% on Monday, with indexes in Singapore, Malaysia, and Indonesia also posting losses. Australia’s S&P/ASX 200 fell by around 0.5%, marking its sixth consecutive week of losses. South Korea’s Kospi index remained flat on the day, while Chinese shares rallied on both the mainland and Hong Kong stock exchanges. Hong Kong’s Hang Seng Index rose 1.6%, while mainland’s CSI 300 index gained 1%. Chinese internet giants Alibaba, Baidu, and Tencent experienced impressive growth of over 3%, while video platform Bilibili surged by more than 11%.
Crude oil prices rose on Monday, as investors disregarded the impact of the SVB collapse on energy demand and focused instead on the prospects of a global economic recovery. Furthermore, crude oil prices were supported by a weaker US dollar and supply disruptions in Libya. In contrast, gold prices surged as investors sought safety amid rising uncertainty and volatility in financial markets. The yellow metal was boosted by a sharp drop in US Treasury yields and a lower US dollar index. The latter fell on Monday, as traders revised down their expectations for US interest rate hikes following the SVB crisis. The US dollar index was also impacted by mixed US jobs data on Friday, which showed a higher-than-expected increase in non-farm payrolls but a lower-than-expected rise in average hourly earnings.
Overall, it appears that the fallout from the SVB collapse has had varying effects across Asian markets, with some experiencing losses and others posting gains. Investors are closely monitoring the situation, particularly in light of the Fed’s emergency funding program, and are likely to remain cautious as events unfold.
Upcoming Events:
Tuesday, March 14, 2023
- 07:00 AM GMT – (GBP) Claimant Count Change
- 07:00 AM GMT – (GBP) Average Earnings Index 3m/y
- 12:30 PM GMT – (USD) CPI m/m
- 12:30 PM GMT – (USD) CPI y/y
- 12:30 PM GMT – (USD) Core CPI m/m
Wednesday, March 15, 2023
- 12:30 PM GMT – (GBP) Annual Budget Release
- 12:30 PM GMT – (USD) Core PPI m/m
- 12:30 PM GMT – (USD) Core Retail Sales m/m
- 12:30 PM GMT – (USD) Empire State Manufacturing Index
- 12:30 PM GMT – (USD) PPI m/m
- 12:30 PM GMT – (USD) Retail Sales m/m
- 09:45 PM GMT – (NZD) GDP q/q
Thursday, March 16, 2023
- 12:30 AM GMT – (AUD) Employment Change
- 12:30 AM GMT – (AUD) Unemployment Rate
- 12:30 PM GMT – (USD) Philly Fed Manufacturing Index
- 12:30 PM GMT – (USD) Unemployment Claims
- 01:15 PM GMT – (EUR) Main Refinancing Rate
- 01:15 PM GMT – (EUR) Monetary Policy Statement
- 01:45 PM GMT – (EUR) ECB Press Conference
Friday, March 17, 2023
- 02:00 PM GMT – (USD) Prelim UoM Consumer Sentiment
- 02:00 PM GMT – (USD) Prelim UoM Inflation Expectations
