Asian equities are trading with a soft positive bias after the mixed performance on Wall Street, where the S&P 500 and Nasdaq notched fresh record closes after some downside after the open. Volatility has been suppressed due to a lack of significant market catalysts. There’s still some risk premium and volatility in the bond market, but today the global fixed income market is trading flat.
This week the yield dynamics drove most of the price action across asset classes. And yesterday, as US Treasury Yields made some pullback from the highs, the Dollar took its cues from the yield complex and rotated lower, giving some support to EM and Majors pairs. It’s worth keeping on the radar some harsh geopolitical tone from Russia after President Putin said the discussion on a settlement of the Ukraine crisis is approaching a dead-end. Putin warned the West is not taking its warnings on red lines seriously enough, saying ties with the US and NATO are unsatisfactory. On the energy front, Oil Traders will be paying attention to any further details on the reports that China is planning a release of its strategic Oil reserves. This could bring some pressure to the energy complex, as it did yesterday during the Asian trade.
