Investors Remain Nervous as Conflict in Ukraine Continues
21 March 2022
The market's downbeat mood will likely continue as there have been no optimistic developments over the weekend.
Although no steep selling was observed, EU bourses opened slightly lower, while the US equity futures were down circa 0.5%. Some profit-taking after last week's strong rally was expected.
German PPI index continued to accelerate in February, printing 25.9% year-on-year, up from 25% previously. Yet, the ECB sees no pressure to lift rates.
In the FX market, the EURUSD pair traded flat during the London session, seen at around 1.1050. US yields ticked higher, pushing the 2-year yield back to 2%.
Commodities advanced, mainly oil, with the WTI benchmark jumping 4% to trade at 110 USD.
Later today, Federal Reserve Chair Jerome Powell is due to speak about the economic outlook at the National Association for Business Economics Annual Economic Policy Conference in Washington DC. His remarks could cause some volatility as he will likely confirm that the economic outlook has deteriorated, mainly due to soaring inflation, rising yields/rates, and the war in Ukraine.
Elsewhere, Ukraine refused to surrender the embattled southern port city of Mariupol as Russia warned of humanitarian 'catastrophe.' As the crisis intensified, it poured cold water on hopes for diplomacy seen over the previous week.