The market continues to fear a further military escalation in the war between Russia and Ukraine and that is weighing on risk sentiment to start the new week.
Equities are marked lower with gold briefly clipping the $2,000 mark earlier, though the latter is still up over 1% near $1,990. Bond yields are also dragged lower, with 10-year Treasury yields sitting close to 1.70%. The 2s-10s spread continues to hold rather narrow at around 24 bps so that remains something to be wary about.
S&P 500 futures are down 1.3%, Nasdaq futures down 1.7%, and Dow futures down 1.0%.
Looking elsewhere, the risk of further bans against Russian oil has caused oil prices to skyrocket as traders also price in the diversification from Russian crude in general. WTI crude hit $130 earlier and is now still up nearly 9% around $125 levels. Talk about a blow up.
That's arguably the standout chart as we look towards European trading today.
Meanwhile, in FX, the euro continues to sink lower as it resumes the downtrend from the end of last week. EUR/CHF is at parity and all eyes will be on whether the SNB has the appetite to catch the falling knife.
The aussie and kiwi are still the two surprise outperformers with both currencies up 0.6% against the dollar. The technicals look great but considering the risk backdrop, it is hard to point to anything else but surging commodity prices that is lifting sentiment in both currencies at the moment.
