Some Positive News From Russia Sends Stocks Higher
21 February 2022
It looks like Monday has started with some careful optimism as equities were trying to erase some of their Friday's losses.
Earlier today, reports spread that the ongoing talks to halt escalation in Ukraine were successful. Late on Sunday, French President Emmanuel Macron has convinced President Biden and Russian President Vladimir Putin to meet at a summit to discuss the security situation in Ukraine.
Although the conflict is far from over, stock indices rose notably following the news.
On the other hand, should the positive sentiment persist this week, the Nasdaq 100 index could have formed a double bottom pattern, with the support near 13,850 USD.
Later today, European preliminary PMIs for February are due, expected to show a slight improvement over January. Already released was the German PMI, with the services Index rising to 56.6 in February, up from 52.2 last month and the highest reading since August. There is no other major macro news on schedule today.
The US bond market is closed today, resulting in no moves in US yields. However, suggesting from the cheerful mood in the markets, US yields will likely move higher tomorrow unless the market situation deteriorates.
The FX market also reacted positively, pushing the EURUSD pair half a percent higher toward 1.14. At the same time, Cable is trying to breach above 1.3650, likely paving the way to test the 200-day average below 1.37.