From Marc to Market:
Overview: There are two themes today. First, there has been a modest bout of profit-taking on Chinese stocks (and yuan) after last week’s surge. Second, the ahead of the five G10 central bank meeting this week a series of market-sensitive economic reports, a consolidative tone is seen in most of the capital markets. Most of the large bourses in the Asia Pacific region fell, led by a 2.2% loss in Hong Kong and 3% loss in its index of mainland shares. Europe’s Stoxx 600 is giving back half of the pre-weekend 0.85% gain, while US futures are posting minor upticks after their slide at the end of last week. Benchmark 10-year bond yield are mostly 2-4 bp lower in Europe though the Gilt yields is off seven bp. Near 3.52%, the 10-year Treasury yield is off five basis points. It rose nine basis points last week. The US dollar is mostly softer, but the yen, Australian and Canadian dollars are struggling. Emerging market currencies are mixed. The South African rand, Philippine peso, and South Korean won are the underperformers, while the central European currencies and Mexican peso enjoy a modicum of strength.
Gold is softer and is hovering around its 200-day moving average ($1791). January WTI is pinned near $70. The cold spell is seeing US gas jumped 11%, the most since the end of October and the fourth consecutive daily gain. Europe’s benchmark is moving in the opposite direction. It is off about 1.8%, its third consecutive decline. After rallying nearly 5% in the past two session, iron ore nearly 1.8% today. March copper is giving back last week’s 0.7% gain in full. On the other hand, March wheat has erased last Friday’s 1.6% decline....
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