Thursday 18th February 2021: Inflation fears lead to investors locking in profits.

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Global Markets:

  • Asian Stock Markets : Nikkei down 0.19%, Shanghai Composite up 0.55%, Hang Seng down 1.84%, ASX up 0.01%
  • Commodities : Gold at $1784.45 (+0.66%), Silver at $27.34 (+0.09%), Brent Oil at $64.86 (+0.81%), WTI Oil at $61.54 (+0.65%)
  • Rates : US 10-year yield at 1.286, UK 10-year yield at 0.591, Germany 10-year yield at -0.360

News & Data:

  • (AUD) Unemployment Rate 6.40% vs 6.50% expected
  • (AUD) Employment Change 29.1K vs 30.2K expected
  • (USD) Retail Sales m/m 5.30% vs 1.10% expected
  • (USD) Core Retail Sales m/m 5.90% vs 1.10% expected
  • (CAD) CPI m/m 0.60% vs 0.50% expected
  • (GBP) CPI y/y 0.70% vs 0.60% expected
  • Facebook’s ‘reprehensible’ move to block news in Australia will have dire consequences, MPs warn

Markets Update:

Asian stocks ended broadly lower on Thursday as largely upbeat U.S. economic data added to optimism about the economic recovery, but raised concerns about inflation.

Chinese markets returned to trade after a long Lunar New Year break. Investors locked in profits on sectors that have outperformed recently in a sign of growing caution about the recent rally in global equities.

The Nikkei 225 in Japan closed 0.2% lower while the Topix index declined 1%. Over in China, the Shanghai composite rose 0.6% while the Shenzhen component fell 1.2%. Hong Kong’s Hang Seng index slipped 1.8%. In Australia, the S&P/ASX 200 traded flat.

Hopes for a stronger U.S. economy supported the greenback. The dollar index, a measure of the currency’s strength against six other major currencies, was steady, holding onto a 0.25% gain from the previous session. The two-year U.S. Treasury yield briefly touched a record low of 0.1049%. Benchmark 10-year yields eased slightly to 1.2771%, pulling away from the highest level since Feb. 27, 2020 as some investors judged that recent selling of fixed income had gone too far.

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