As the North American session begins, the CAD is the strongest and the GBP is the weakest. The USD is mostly weaker.
The CAD is the strongest despite a weaker jobs report on Friday due to Omicron. The GBP is weaker despite a 2nd consecutive hike in rates by the BOE last week with dissenters dissenting because they wanted 50 bp hike (vs the 25 bp hike that happened).
The greenback is unchanged versus the EUR and NZD and only modestly higher vs the GBP today. It is lower vs the rest after rising on Friday on the better than expected US jobs report and sharp move higher in yields (up 12.4 basis points in the 2 year yield).
The US jobs report showed a surprise 467K gain (expected 110K to 150K mostly). The revisions added another 700K. The Unemployment rate did ticked up to 4.0% from 3.9% but that was because more workers entered the workforce. Hourly earnings rose by 0.7% which was higher than the 0.5% expected gain and 5.7% for the year on year.
European benchmark 10 year yields are higher today after the ECB pivoted toward potential tightening in 2022. The German 10 year is up to 0.24% today. Last week the yield moved up around 26 basis points on a move from -0.04% to 0.229% (on the close on Friday). Meanwhile, the 2 year yield soared from -0.604% to -0.214%. That is the highest level since October 2015. Italian 10 year yields are within 4-5 basis points of the US 10 year yield at 1.87% today. The yield has been below the US 10 year since October 2020.
The US stocks are modestly higher today after the Nasdaq 219 point rise on Friday (+1.58%). The Dow (-0.06%) and the S&P (+0.52%) had less success as investors looked to buy cheap in the Nasdaq. All three indices moved higher last week after a big week of earnings (Amazon and AMD soared). Meta and Paypal did not fare so well, however, after declining over -25% each on earnings/guidance misses. Amazon buying Peleton? That is what the rumours were over the weekend.
Bitcoin surged on Friday (because Nasdaq moved higher? or is it this story - "Bitcoin has become a lifeline for sex workers..." - from CNBC?). It moved from a low of $37064 on Friday to a high today of $43067 (or 16.2%) which keeps the get rich quick theme alive in the digital currency despite threats of regulation that might kill the golden goose (for some). The recent cycle low reached $32950. The high today is the highest since January 20.
Crude oil is down but still above $90 with Russia/Ukraine still a hot topic. The high price reached $92.73 today. The high from last week extended to $93.17 which was the highest level since September/October 2014.
In other markets, the morning snapshot shows:
- Spot gold is trading up $6.51 or 0.36% $1814.05
- Spot silver is up $0.42 or 1.88% at $22.90
- WTI crude oil futures are trading down $0.99 at $91.32
- The price of bitcoin is trading at $42,682. On Friday, the digital currency settle near $41,579. Over the weekend, it continued to push higher (more modestly)
The premarket for US stocks, the major indices are trading higher:
- Dow industrial average up 47.26 points after their Friday's -21.42 point decline
- S&P index up 10 points after Friday's 23.11 point rise
- NASDAQ index +60 points after Friday's 219.19 point rise
In the European equity markets, the major indices are lower as they play catch-up to the sharp falls in the US stocks yesterday afternoon:
- German DAX, +0.36%
- France's CAC +0.22%
- UK's FTSE 100 +0.5%
- Spain's Ibex -0.35%
- Italy's FTSE MIB -1.21%
In the US debt market, the yields are modestly lower after the sharp rise on Friday:
The European yields are continuing their move to the upside with the 10 yield up near 12 basis points on the day:
