Thursday 25th February 2021: Powell comments save risk assets

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Global Markets:

  • Asian Stock Markets : Nikkei up 1.67%, Shanghai Composite up 0.59%, Hang Seng up 1.20%, ASX up 0.83%
  • Commodities : Gold at $1788.60 (-0.52%), Silver at $27.88 (+0.06%), Brent Oil at $66.68 (+0.76%), WTI Oil at $63.64 (+0.66%)
  • Rates : US 10-year yield at 1.444, UK 10-year yield at 0.786, Germany 10-year yield at -0.268

News & Data:

  • (AUD) Private Capital Expenditure q/q 3.00% vs 1.10% expected
  • (NZD) Final ANZ Business Confidence 7 vs 11.8 previous
  • (USD) Crude Oil Inventories 1.3M vs -6.5M expected
  • Germany: Consumer sentiment recovers slightly from lockdown shock
  • Tiger Woods Crash Echoes Across Golf Industry That He Defined

Markets Update:

Asian stocks rallied on Thursday as bond yields eased and dovish comments by U.S. Federal Reserve chairman Jerome Powell soothed worries around inflation and interest rates. In his second day of testimony before Congress, Powell said the Fed plans to leave interest rates unchanged for a long time to come.

In Japan, the Nikkei 225 gained 1.7% as shares of conglomerate SoftBank Group surged 3.8%. The Topix index also gained 1.2%. Hong Kong’s Hang Seng index also saw gains as it rose 1.2%. Mainland Chinese stocks were mixed on the day as the Shanghai composite gained 0.6% while the Shenzhen component dipped 0.3%. The S&P/ASX 200 in Australia gained 0.8%.

A closely watched part of the U.S. yield curve measuring the gap between yields on two- and 10-year Treasury notes rose to 127.4 basis points, near its 2016 peak of around 136 hit after Donald Trump’s surprise election victory. Crude oil climbed to fresh 13-month highs after U.S. government data showed a drop in crude output as a deep freeze disrupted production last week.

Upcoming Events:

  • 12:30 AM GMT – (AUD) Private Capital Expenditure q/q
  • 01:30 PM GMT – (USD) Prelim GDP q/q