Market News

EUR/USD
The market opening gave a slow start for EUR/USD to open below 1.2200, speaking the trend for today. further rise is expected with the 1.2050 support intact. watching the sluggish upside movement, the break of 1.2244 will resume the rise from 1.1703 to retest 1.2348 high. In the corresponding scenario, the break of 1.2050 will delay the bullish case. Looking out to the big picture, the reluctance of Federal Reserve Officials to signal a recalibration of policy gave the boost in the economy, these conditions are going to favor the pair giving the bullish scenario.

GBP/USD
The pair have been seen picking the recovery to 1.14152, which is 0.03% intraday. ahead of today’s opening of the London session. In doing so, the pair is taking hints from the upbeat risk reversal for the recovery moves from a short-term support line. On the upside, the decisive break of 1.4240 will again lead uptrend for 1.4376 key resistance. This break will carry larger bullish implications giving the target of 38.2% retracement Speaking of an alternate scenario, the break of 1.4098 support will delay the bullish outlook.

USD/JPY

The USDJPY pair remained depressed heading into the European session. Watching the intraday bias in the pair, the movement of the pair will be neutral as the trading range continues. On upside above 109.77, it will resume the rebound from 107.47 to retest 110.95 high. On the downside, the break of 108.34 will turn bias back to the downside for 107.47 support. The US dollar rose 37 pips against the Japanese yen on Friday. All things being equal, the exchange rate could continue to edge higher. A possible target for the pair will be near the 103.30 area.

XAU/USD
Watching out the commodity, Gold is meeting critical monthly resistance. Gold edged higher during the early part of trading action today. Giving the four-month high of $1887, before pulling back slightly. Watching out the US Manufacturing and service PMI data which was stronger than expected boosted the inflation outlook. Meanwhile, the US DOllar index is hovering near a three-month low of 90.02, lending support to the yellow metal.

10:39 am

Forex News

May 21, 2021

A Busy Economic Calendar Puts the EUR, the Loonie, the Pound, and the U.S Dollar in Focus

Technical Market Analysis

EUR/USD

Looking out to the pair, the price has already given the dip of 30 pips as the US dollar strengthened, by the mid of Thursday noon EUR/USD had been pushed up by the SMA to the resistance price of 1.2200. We can say that the pair will remain on the front foot around 1.2230 during the early morning today, later we have seen there was the decline of 0.5% of our dollar, On the monetary policy front, ECB president Lagarde is also scheduled to speak, major key levels of the pairs are as follow
Support level 1.2226
Resistance level 1.2239

GBP/USD

We can say that GBPUSD maintains a bullish bias in the short term picture, The pair opened at a higher price and quickly retreated toward the session’s low near 1.4169 giving the movement of 30 pips, Currently, the pair is trading at 1.4177 down of 0.08% on the day.
support level 1.4166
Resistance level 1.4181

AUD/USD
The Australian employment data largely disappointed yesterday giving the sharp decrease of 30,600 jobs against an expected gain of 15,000 jobs for April. Although there was a boost overnight following the slide on the greenback, the unemployment rate falls to 5.5%. Today we can see stable movement at 0.7756 and it could give the range between 0.78-0.7750 region for now. If there will be a break on any of these prices, it will give clarity on future movements
Support level 0.7746
Resistance level 0.7770

XAU/USD

The commodity is witnessed down on Friday morning in Asia Session as an improving outlook for Investors, however, dollar weakness and growth in Inflationary pressure capped losses. The latest update for the commodity is while bouncing off the intraday low, gold prints mild losses which is 0.10% coming around 1875.40 during Friday’s Asian session. Giving the consolidated gains, here are the levels it can witness today
Support level 1870.34
Resistance level 1878.44.

10:27 am

Forex News

May 20, 2021

The Dollar weakened as Fed Minutes Sign at Narrow Discussion

The dollar dropped on Thursday morning in Asia as the U.S. Federal Reserve meeting minutes unveiled that policymakers recommended a slowdown of bond purchase due to a sign of hastening inflation.

The U.S. Dollar Index traces the greenback against a basket of other currencies slightly down 0.08% to 90.123

The USD/JPY pair dropped 0.07% to 109.14 as April’s trade data released earlier in the day surpassed expectations.
Exports expanded 38.0% year-on-year, Imports improved 12.8% year-on-year and the trade balance remains at JPY225.3 billion.

The AUD/USD pair trimmed up 0.17% to 0.7740. Employment data for April released earlier in the day said that the employment change declined by 30,600 in April while the unemployment rate dropped to 5.5%.
The NZD/USD pair slightly up 0.13% to 0.7176.

The USD/CNY pair inched up 0.07% to 6.4385, with the People’s Bank of China releasing the loan prime rate earlier in the day.

The GBP/USD pair slightly up 0.01% to 1.4114.

Investors are shocked by the verdict of Fed Chairman Jerome Powell and other Fed official has mentioned again that the Fed dovish policy will remain unchanged as any rise in inflation would be temporary.

7:38 am

Forex News

May 19, 2021

Dollar Steadied Against Major Currencies; Bitcoin Tumbled On China’s Verdict

The Dollar Stabilized versus major currencies on Wednesday as traders were waiting for U.S. Federal Reserve minutes, Although bitcoin dropped after China halted its financial institutions from offering services related to cryptocurrency assets.

The minutes from the Fed’s most recent meeting is going to take place later on Wednesday are assumed to validate that policymakers are perhaps not ready to increase the rates.

The U.S currency traded at $1.2076 against the Canadian dollar close to its weakest since May 2015.

The GBP bought $1.4187, which was near its strongest level since late February.

The EUR was constant at $1.2231.
The dollar slightly moved at 108.96 against the yen and 0.8974 against the Swiss franc.
Previous week Data showing U.S. consumer prices increased 4.2% in April from a year earlier, was the quickest development in more than a decade, boosting concerns the Fed will have to commence raising interest rates earlier.

Fed policymakers confirmed that the rise is short-lived and repeated that they expect rates to remain flat, though not all are convinced by the Fed’s line.

The Dollar Index traces the U.S. Currency against a basket of six major currencies was valued at 89.732.

CAD and GBP Elevated as the expectations for policy tightening in Canada and the progressive lifting of all the restriction of coronavirus in Britain. However, any favorable inflation can lead the Dollar to recover from some of its losses.

In the cryptocurrency market, bitcoin plunged below the closely-watched $40,000-mark to a three-month low of $39,000.
Ether dropped by more than 13% to $2,900, which is a two-week low.

Managerial uncertainty has appeared as an adverse factor after China banned its financial systems from offering cryptocurrency registration, trading, clearing, and settlement in a blow to investors who were betting that digital assets will gain mainstream status.

8:01 am

Forex News

May 18, 2021

Dollar Declined as Investors speculate on the U.S. Interest Rate Staying lower

The dollar slipped on Tuesday morning in Asia, hitting a six-year low against its Canadian counterpart and hanging close to multi-month lows against European currencies because investors are expecting that up bets the U.S. Federal Reserve would not lift interest rates.

The U.S. Dollar Index traces the greenback against a basket of other currencies slightly down 0.05% to 90.097.

The USD/JPY pair slightly up 0.03% to 109.22, with Japan’s slow COVID-19 vaccination rate and dollar weakness securing the duo into a narrow range.

The yen also fell against the pound and the riskier currencies as data released earlier in the day said that the Japanese economy contracted more than expected during the first quarter of 2021, as its GDP contracted 5.1% yearly and 1.3% quarterly.

The AUD/USD pair was high 0.35% to 0.7791, with the Reserve Bank of Australia releasing the minutes from its latest meeting earlier in the day.
The NZD/USD pair gained 0.47% to 0.7234.
The USD/CNY pair slightly down 0.17% to 6.4278.
The GBP/USD pair was high 0.27% to 1.4173, its most powerful level since February 2021, as the U.K. begins to get out from the stringent COVID-19 lockdown.
The dollar was at $1.2167 against the euro, close to its weakest level since Feb. 26, 2021. The Canadian dollar climbed to a six-year high of C$1.2045 against its U.S. counterpart, supported by a rise in oil prices.

On Monday, Dallas Fed President Robert Kaplan repeated his view that he does not expect interest rates to rise until 2022, thus sparking a further drop in bets that inflationary pressure could force the central bank to act sooner than expected.

Other Fed officials are expected to speak throughout the week and investors also await the release of the minutes from the Fed’s latest meeting, due on Wednesday.

Investors will examine the minutes once they are delivered for evidence as to the Fed’s monetary policy direction for the rest of 2021. However, an agreement is building that the Fed will continue with its current negative policy over the assumption that any acceleration in inflation is temporary, in turn keeping the dollar on a downward trend.

8:40 am

Forex News

May 17, 2021

Dollar Higher Over Asian Covid-19 Upsurge Concerns

The Dollar elevated on Monday morning in Asia amid distresses caused by fresh COVID-19 cases in some Asian Countries. Notwithstanding, investors are densely positioning for a drop in the U.S. currency as the U.S. Federal Reserve holds to its current dovish policy.

The U.S. dollar index traces the greenback against a basket of other currencies slightly up 0.06% to 90.373.
The USD/JPY pair slightly up 0.01% to 109.336.
The AUD/USD pair was declined 0.24% to 0.7753, with the reserve bank of Australia due to release the minutes from its latest meeting on Tuesday.

The NZD/USD pair declined 0.52% to 0.7216.

The USD/CNY pair Slightly up 0.03% to 6.4384.
Chinese industrial production growth decreased to 9.8% yearly in April, as per the data released earlier in the day.

The GBP/USD pair slightly down 0.04% to 1.4090.
However, the pound was almost a two-and-a-half-month high as the U.K. reopens its economy after a four-month lockdown.

The U.S. currency was supported by facilitating commodity prices and the COVID-19 outbreaks in Singapore and Taiwan with both countries hardening restrictive measures.
Singaporean primary, secondary, junior college, and Millennia Institute students shifted to full home-based learning from May 19 till the end of the school term on May 28.

However, a rebound from surprisingly good U.S. inflation data released during the earlier week dissolved over uprising investor hopes that the Fed will keep investment rates low.

10:05 am

Forex News

May 14, 2021

Dollar Topple; Inflation Concerns Indicate Substantial Week

The Dollar declined in early European trade on Friday after the one-week gain because traders considerably seem to be fine with the latest inflation data that could impact on Federal Reserve Policy.

The Dollar Index, which traces the U.S. currency against a basket of six other currencies was declined 0.2% at 90.532.

EUR/USD was traded 0.3% higher at 1.2109.
GBP/USD was high 0.1% at 1.4068.
USD/JPY was declined 0.1% at 109.39.
AUD/USD elevated 0.2% to 0.7744.
NZD/USD elevated 0.3% to 0.7192.

The release of Factory gate price data in the U.S. on Thursday with the Producer Price Index Inclined by 0.6% in April and the Annual Figure climbed by 6.2% which was the highest yearly rise since the series was renewed in 2010.

This powerful data add to Wednesday’s remarkable rise in consumer price. Submitting inflationary pressure is building up in the United States because of the vaccine rollouts ready to reopen of a rupturing economy.

Benchmark 10- Year U.S. Treasury yields declined after the PPI data and now trade around 1.65%.

For today, the center of attraction will be the U.S. retail sales for April, which should continue to persist strongly after the impressive 9.7% rise in March, as well as industrial production numbers and consumer sentiments for May.

12:01 pm

Economic News

March 11, 2022

Goldman Sachs and JPMorgan Chase are exiting the Russia business, and EU banks are disclosing additional exposures

Goldman Sachs Group Inc and JPMorgan Chase were the first U.S. banks to stop doing business in Russia after it invaded Ukraine, while Credit Suisse said it had 1.6 billion Swiss francs ($1.73 billion) in gross exposure to Russia at the end of last year. Goldman Sachs, which has a $650 million credit exposure to Russia, announced on Thursday that it was closing its operations there, putting pressure on rival lenders to follow suit. According to a source familiar with the situation, any losses would be “insignificant.”

JPMorgan said just hours later that it was “actively unwinding Russian business” and would not be pursuing new business in the country. The largest US bank said its operations in Russia are currently limited to assisting global clients with addressing and closing pre-existing obligations and managing Russian-related risk, as well as acting as a custodian for client assets. JPMorgan employs approximately 160 people in Moscow. In its most recent filings, the bank did not list Russia among the top 20 countries to which it has the most exposure.

In response to Russia’s invasion of Ukraine, the United States, European Union, and the United Kingdom imposed sanctions aimed at cutting off Moscow’s access to the global financial system. As the conflict enters its third week, banks, insurers, and asset managers, which rarely make political statements, have scrambled to distance themselves from Russia and assess their exposures. Credit Suisse is the latest European bank to reveal the size of potential losses, which include lending to wealthy clients as well as trade finance and investment banking exposure.

Credit Suisse is the latest European bank to reveal the size of potential losses, which include lending to wealthy clients as well as trade finance and investment banking exposure. UniCredit of Italy and BNP Paribas of France have also disclosed billions of euros in Russia risk. Banks could lose everything if Moscow seizes assets and sanctions render Russia-related securities worthless. Deutsche Bank stated that its credit-risk exposure to Russia and Ukraine was 2.9 billion euros, and that it had reduced its exposure to Russia even further in the last two weeks. Russia refers to its operations in Ukraine as a “special operation.”

While the potential losses among major European lenders are not large enough to jeopardies their stability, analysts and investors are concerned that they could derail turnaround plans and halt dividend payments to shareholders. The conflict has also potentially upended the European Central Bank’s planned interest rate increases, with policymakers expected to be divided on how to proceed and wary of making mistakes at a meeting on Thursday. Meanwhile, BNP Paribas has disconnected its Russia-based workforce from its internal computer systems in order to strengthen its defenses against any potential cyber attack, highlighting how the conflict is affecting Western financial institutions. The French bank, thought to be the first major lender to block Moscow-based employees from accessing its IT networks, has also placed employees in other locations on high alert for Russian cyber threats.

4:57 am

Economic News

March 10, 2022

By 2025, Deutsche Bank wants to invest 200 billion euros in sustainable projects

By 2025, Deutsche Bank DBKGn.DE intends to invest at least 200 billion euros ($216.8 billion) in so-called sustainable financing and investments, marking the bank’s first public targets in this area. The funds will come from bank loans, bonds made on behalf of clients, and assets handled by the bank’s private bank. It does not include assets handled by DWS, the company’s fund arm, according to a statement released late Tuesday.

As pressure mounts on banks to help the universally agreed transition to a low-carbon, environmentally friendly economy, this is the latest action by a major global institution to demonstrate commitment to sustainable investing.

After the COVID-19 outbreak, countries in Europe and beyond have been focusing on ensuring that long-term investment is at the center of economic recovery efforts. Deutsche Bank stated it would either use its own “clear criteria” or a planned European Union framework known as the sustainable finance taxonomy to define sustainable activities. By the end of the second quarter of this year, the bank said it would report on its progress annually and provide further specifics on its definition of sustainable finance.

“We are driven by a very strong commitment to help influence the global transformation to a sustainable, climate-neutral, and social economy,” said CEO Christian Sewing, who described the 200 billion euro objective as “ambitious” in comparison to its competitors’. “However, we’re off to a strong start since, as an internationally active financing firm, we’ll be able to meet our clients’ growing need for sustainable investment solutions on our own.”

3:56 am

Economic News

March 9, 2022

British stocks rise as energy stocks soar; Shell discontinues purchases of Russian oil

The FTSE 100 in London edged higher on Tuesday, aided by strong gains in energy stocks as oil prices rose after Britain and the United States announced bans on Russian crude imports, while insurer and asset manager M&G was the top index gainer thanks to a share buyback program. The blue-chip FTSE 100 rose 0.1 percent, with Shell and BP leading the way.

According to Business Minister Kwasi Kwarteng, Britain will phase out Russian imports of oil and oil products by the end of 2022. Separately, the world’s largest oil consumer, the United States, announced a ban on Russian oil imports. Shell stopped buying Russian crude and announced that it would phase out its involvement in all Russian hydrocarbons, from oil to natural gas, over Ukraine, becoming one of the first major Western oil companies to abandon Russia entirely.

“As concerns about oil supply continue,” said Susannah Streeter, senior analyst at Hargreaves Lansdown, “the elevated price of crude should keep Shell on the path of slicing big chunks off net debt and funding capital expenditure in new gas field expansion and low carbon alternatives like hydrogen.” The FTSE 100 has dropped 5.7 percent this year, the least among developed markets in Europe and the United States, owing primarily to strong oil stocks. However, the rise in energy prices has raised concerns about inflation and economic growth.

Energy stocks gained 3.5 percent a day after posting their best session since January 2021, and it is the top gaining UK sub-index this year, up 21.7 percent. In the United Kingdom, the Resolution Foundation think tank predicted that the conflict would cause wider inflation, slashing 4% from the real level of typical household incomes over the next year, the steepest drop in nearly a half-century. The domestically focused mid-cap index rose 0.3 percent, regaining ground from the previous session’s lows, which were last seen in November 2020.

“It’s probably just a rebound because we haven’t seen another devastating headline in a short period of time, allowing for some kind of minor relief rally,” said Craig Erlam, senior market analyst at Oanda. M&G gained 15.0 percent among individual stocks after the insurer and asset manager announced a 500 million pound ($654.30 million) share buyback programme. Greggs, the British baker and fast food chain, fell 3.4 percent after warning that rising raw material, energy, and labour costs would limit any material profit growth in 2022.

6:02 am

Economic News

March 8, 2022

Tightening financial conditions are a warning sign for the global economy

Global financial conditions, which are thought to be strongly correlated with future growth, are at their tightest in two years, owing to rising energy prices, falling stock markets, and market fallout from the Ukraine-Russia conflict. The term “financial conditions” refers to how variables such as exchange rates, equity swings, and borrowing costs affect the availability of funding in the economy. The spending, saving, and investment plans of businesses and households are determined by how loose or tight conditions are.

Goldman Sachs, which compiles the most widely used financial conditions indexes, has previously shown that a 100-basis-point tightening reduces growth by one percentage point in the coming year, while an equivalent loosening boosts growth by the same amount. The tightening is an unwelcome development for a global economy already beleaguered by the fallout from $120-per-barrel oil prices and supply chain disruptions caused by Russian sanctions.

If these continue to drive inflation higher, and “if central banks take their mandates seriously,” “you will see a further (tightening) in financial conditions,” according to Rene Albrecht, strategist at DZ Bank. “Economic dynamics will slow down even more, inflation will remain high, and you will see second-round effects, and then you get a stagflation scenario,” he added, referring to a combination of rising inflation and slower economic growth.

Goldman Sachs’ global financial conditions index (FCI) is at 100.2, which is 60 basis points (bps) tighter than it was prior to Russia’s invasion of Ukraine and a level last seen in March 2020, when the pandemic first struck. The rise was led by its Russian FCI, which rose to 114.8 from around 98 at the start of February to the tightest since the 2008 crisis, owing to a doubling of interest rates and a market collapse. The Russian move has pushed the emerging market FCI to its tightest level since 2016.

The moves in the Eurozone are also significant. Conditions in the bloc, which is heavily reliant on Russian energy, are the tightest they have been since November 2020, having moved 50 basis points (bps) in February, aided by the European Central Bank (ECB) opening the door to rate hikes this year. According to Viraj Patel, global macro strategist at Vanda Research, financial conditions will become even more important for the ECB when it meets on Thursday.

If it proceeds with the expected unwinding of bond purchases followed by rate hikes, financial conditions could tighten to levels seen at the height of the pandemic or even the EU’s sovereign debt crisis a decade ago, he added. Conditions in the United States have tightened to a lesser extent. However, the indicators Goldman uses to calculate its indexes show no signs of improvement; safe-haven flows are boosting the US dollar, which is near two-year highs, and global stocks have fallen 11% this year, led by a near-20% drop in eurozone equities. As investors assess the impact on companies’ profits, risk premia on investment-grade corporate bonds in the United States have widened by 40 basis points year to date.

Because conditions in developed markets have historically been loose, policymakers may not be too concerned just yet. Borrowing costs have fallen sharply in inflation-adjusted terms, reaching a record low of -2.5 percent in Germany on Monday. According to Peter Chatwell, Mizuho’s head of multi-asset strategy, this gives central banks “more room to speak hawkishly and for those on the verge of acting hawkishly, acting hawkishly.”

4:04 am

Economic News

March 7, 2022

Oil prices have risen to their highest level since 2008, owing to delays in Iranian talks

Oil prices have risen to their highest level since 2008, owing to delays in the potential return of Iranian crude to global markets and as the United States and its European allies consider prohibiting Russian oil imports. On Sunday, talks to resurrect Iran’s 2015 nuclear deal with world powers were hampered by Russia’s demand for a US guarantee that the sanctions imposed on it as a result of the Ukraine conflict will not harm its trade with Tehran. According to sources, China has also raised new demands.

In response to Russia’s demands, US Secretary of State Antony Blinken stated on Sunday that sanctions imposed on Russia for its invasion of Ukraine have nothing to do with a possible nuclear deal with Iran. Meanwhile, the US and its European allies are considering a ban on Russian oil imports, according to Blinken, and the White House is working with key Congressional committees that are considering their own ban. Brent crude rose $11.67, or 9.9 percent, to $129.78 per barrel by 6:50 p.m. EST (2350 GMT), while WTI crude rose $10.83, or 9.4 percent, to $126.51, putting both contracts on track for their highest daily percentage gains since May 2020.

Both benchmarks rose to their highest levels since July 2008 in the first few minutes of trading on Sunday, with Brent at $139.13 per barrel and WTI at $130.50. Brent peaked at $147.50 per barrel in July 2008, while WTI peaked at $147.27. Following the surge in crude prices in the first few minutes after the market opened on Sunday, U.S. gasoline and distillate futures rose to record highs.”Iran was the only real bearish factor hanging over the market, but if the Iranian deal is delayed, we could get to tank bottoms a lot faster, especially if Russian barrels remain off the market for an extended period of time,” said Amrita Sen, co-founder of the think tank Energy Aspects.

According to JP Morgan analysts, oil could reach $185 per barrel this year.”The idea was not to sanction oil and gas because of their essential nature,” said Daniel Yergin, author and vice chairman of S&P Global, ahead of the CERA Week conference in Houston. “But oil is getting sanctioned by private actors not wanting to pick it up or ports not wanting to receive it, and the longer this goes on, the more supply chains are going to buckle.” Russia exports approximately 7 million barrels per day of crude oil and refined products, accounting for approximately 7% of global supply. Some of Kazakhstan’s oil exports from Russian ports have also been hampered.

According to Bank of America analysts, if most of Russia’s oil exports are cut off, there could be a 5 million barrel or larger shortfall, resulting in oil prices doubling from $100 to $200 per barrel. Analysts estimate that even if Iran achieves a nuclear deal, it will take several months to restore oil flows. Eurasia Group said new Russian demands could derail nuclear talks, but it still sees a 70 percent chance of a deal. “Russia may intend to use Iran to avoid Western sanctions. A written guarantee allowing Russia to do so is likely to be far beyond what Washington can offer in the midst of a full-fledged war in Ukraine “said Henry Rome of Eurasia.

The closure of Libya’s El Feel and Sharara oilfields resulted in a loss of 330,000 barrels per day (bpd), according to the National Oil Corporation (NOC) on Sunday. According to US energy data, Libya, an OPEC member, produced approximately 1.2 million barrels per day of crude in 2021. Meanwhile, according to AAA, an automobile association, the average price of a gallon of gasoline in the United States hit $4.009 on Sunday, the highest since late July 2008.

Consumers are paying 40 cents more per gallon than a week ago and 57 cents more per gallon than a month ago. According to AAA, which has data dating back to 2000, U.S. gasoline prices at the pump reached a record $4.114 on July 17, 2008. Senior US officials arrived in Venezuela on Saturday for talks with President Nicolas Maduro’s administration, hoping to determine whether Caracas is willing to distance itself from close ally Russia.

5:46 am

Economic News

March 1, 2022

The withdrawal of Western companies from Russia is expected to accelerate

More Western corporations and investors are expected to leave Russia on Tuesday, following in the footsteps of energy firms BP and Shell, which abandoned multibillion-dollar positions following the invasion of Ukraine. Leading banks, airlines, automakers, and other companies have reduced shipments, terminated partnerships, and deemed Russia’s actions unacceptable. Many more said they were thinking about taking action.

Following Walt Disney Co’s (DIS.N) announcement that it would pause the release of theatrical films in Russia, Warner Bros. announced late Monday that it would pull this week’s release of ‘The Batman’ from Russian theatres. Meanwhile, Mastercard announced that it had blocked multiple financial institutions from its payment network as a result of Russia sanctions. The West has moved to punish Russia with a slew of sanctions, including the closure of airspace to Russian planes, the exclusion of some Russian banks from the global financial network SWIFT, and restrictions on Moscow’s ability to use its $630 billion in foreign reserves.

“I would expect to see a slew of similar announcements in the coming days,” Sonia Kowal, president of Zevin Asset Management in Boston, said on Monday, adding that divestment by Norway’s large sovereign wealth fund would support the move. Some state-linked investors in the United States have been vocal in setting corporate expectations.”We need to send a very clear and unequivocal response that California will not stand for Russia’s aggression,” California Treasurer Fiona Ma said in a statement on Monday, expressing support for divesting Russian assets from the state’s pension funds, which are among the largest in the country.
Shell (SHEL.L), BP, and Norway’s Equinor (EQNR.OL) have all announced plans to exit positions in energy-rich Russia, putting pressure on other Western companies with stakes in Russian oil and gas projects, including ExxonMobil (XOM.N) and Total Energies (TOT) (TTEF.PA). Many companies are still considering their options, including shipper Maersk, which said on Monday that it was monitoring Russian sanctions and preparing to comply with them. Cargo bookings could be halted in one scenario.

Major auto and truck manufacturers, including Volvo and GM (GM.N), have suspended exports to Russia, despite the fact that the two companies only sell about 12,000 vehicles in Russia each year. Ford Motor (F.N), which owns a 50% stake in three Russian plants, has made no substantive comments on its plans other than to say that it intends to build a new plant in Russia.

Companies and asset managers looking to sell stakes face challenges because many exchanges have halted trading. Some Western companies with significant exposure to Russia have already seen their stock prices fall. Finnair, based in Russia’s neighbour Finland, lost a fifth of its value after withdrawing its forecast for 2022 due to airspace closures. Airlines are bracing for lengthy delays in east-west flight corridors following airspace bans issued by the European Union and Moscow. Senator Dick Durbin, the Senate’s second-highest ranking Democrat, has expressed support for a ban.

“Other European countries have done it, and turning off the lights at the airport on those guys isn’t a bad idea,” he told reporters. Big tech companies are balancing calls to shut down services in Russia with what they see as a mission to give dissent and protest a voice.
The parent company of Facebook, Meta Platforms Inc (FB.O), will restrict access to Russian state media outlets RT and Sputnik on its platforms across the European Union, the company’s head of global affairs said on Monday, echoing similar moves by major U.S. tech companies.

The White House has not made a decision on banning Russian flights, but White House press secretary Jen Psaki told reporters on Monday, “There are a lot of flights that US airlines fly over Russia to go to Asia and other parts of the world, and we factor in a range of factors.”

3:58 am

Economic News

February 28, 2022

As Ukraine risks rise, crude prices rise and the rouble falls to a record low

On Monday, crude oil rose while the rouble fell nearly 30% to a new record low after Western nations imposed new sanctions on Russia for its invasion of Ukraine, including the exclusion of some banks from the SWIFT international payments system. Bond yields rose along with the dollar and yen, while the euro fell after Russian President Vladimir Putin placed nuclear-armed forces on high alert on Sunday, the fourth day of the biggest assault on a European state since World War II.

The escalation of tensions raised concerns that oil supplies from the world’s second-largest producer could be disrupted, sending Brent crude futures up $4.21, or 4.3 percent, to $102.14. West Texas Intermediate (WTI) crude futures in the United States were up $4.58, or 5.0 percent, to $96.17 per barrel. U.S. and European stock futures fell, but Asia-Pacific stocks rose in volatile trading, buoyed by Wall Street gains from Friday, when the S&P 500 closed up 2.51%, according to Kyle Rodda, a market analyst at IG Australia.
“Over the weekend, we had a deluge of very negative information,” Rodda said. “My sense is that there won’t be much staying power behind this particular move (in Asia-Pacific stocks), given the risks to financial stability and the threat of nuclear war.” “Volatility has increased,” he said. “The price action is extremely choppy.” At the start, U.S. emini stock futures were pointing to a 1.57 percent drop, while pan-European EURO STOXX 50 futures were down 2.83 percent.

The Nikkei 225 (.N225) in Japan rose 0.48 percent, recouping a previous loss. Australia’s benchmark (.AXJO) rose 0.64 percent after initially falling. However, Chinese blue chips (.CSI300) fell 0.21 percent. The MSCI regional stock index (.MIAP00000PUS) gained 0.09 percent. Meanwhile, the 10-year US Treasury yield fell by about 6 basis points to 1.92 percent, while equivalent Australian yields fell by about 6 basis points to 2.18 percent. The euro fell 0.9 percent to $1.1170 and 0.87 percent to 129.065 yen, while the riskier Australian and New Zealand dollars fell 0.66 and 0.76 percent, respectively. The rouble fell 29.37 percent to a record low of 119 rubles per dollar.