• European bourses are firmer in an extension of yesterday's upside, with the Stoxx 600 +2.0% on the session but still lower on the week.
• US futures are firmer across the board with the NQ, +2.0%, outpacing and benefitting from MSFT post earnings, +4.0% in pre-market.
• Greenback stands firm awaiting something hawkish from the Fed; newsquawk preview here.
• Loonie loving risk recovery and WTI revival in run up to likely BoC hike; newsquawk preview here
• WTI and Brent March futures have continued grinding higher despite quiet news flow as focus remains on geopolitics and the benchmarks also benefit from equity action.
• Looking ahead, highlights include FOMC & BoC Policy Announcements/Press Conferences. Earnings from General Dynamics, Nasdaq, Abbott, Boeing, Intel, Tesla.

As of 11:10GMT/06:10EST

LOOKING AHEAD

• Looking ahead, highlights include FOMC & BoC Policy Announcements/Press Conferences. Earnings from General Dynamics, Nasdaq, Abbott, Boeing, Intel, Tesla.

Click here for the Week Ahead preview

EUROPEAN TRADE

EQUITIES

• European bourses are firmer in an extension of yesterday's upside, with the Stoxx 600 +2.0% on the session but still lower on the week.
• US futures are firmer across the board with the NQ, +2.0%, outpacing and benefitting from MSFT post earnings, +4.0% in pre-market.
• European sectors are all in the green with Travel & Leisure outperforming amid broker action while Oil & Gas is a relatively close second given crude action.
• EU antitrust decision against Intel (INTC) has been annulled in part by the EU General Court. (Newswires)
• Microsoft (MSFT) Q2 2022 (USD): EPS 2.48 (exp. 2.31), Revenue 51.73bln (exp. 50.88bln). Co. sees Q3 product revenue between USD 15.6bln-15.8bln and expects Azure revenue growth to increase significantly, while it guides Q3 rev. USD 48.5bln-49.3bln (implied) vs exp. USD 47.7bln. (Newswires) +4.0% in the pre-market

Click here for a detailed summary.

FX

• Loonie loving risk recovery and WTI revival in run up to likely BoC hike; newsquawk preview here
• Aussie rebounds in absence of those away for a national holiday.
• Greenback stands firm awaiting something hawkish from the Fed; newsquawk preview here.
• Kiwi hovering ahead of NZ CPI. -Pound pensive before Partygate findings are published.
• Rouble unable to benefit from Brent bounce as Russia begins big drills in Black Sea to keep geopolitical tensions elevated.

Click here for a detailed summary.

Notable Expiries, NY Cut:

• EUR/USD: 1.1150 (537M), 1.1225-35 (1.5BN), 1.1280 (363M), 1.1290-00 (650M), 1.1350 (648M), 1.1400 (284M), 1.1440-45 (630M), 1.1500 (1.06BN), 1.1545-50 (1.0BN)
• Click here for the full list.

FIXED INCOME

• Bonds rangy and flanked by near term chart points pre-BoC and Fed policy events.
• Bunds hardly react to mixed 2032 tap.
• Gilts also eyeing further UK political developments and BTPs await the next rounds of voting for a new Italian President (assuming no return of the current incumbent).

Click here for a detailed summary.

COMMODITIES

• WTI and Brent March futures have continued grinding higher despite quiet news flow as focus remains on geopolitics and the benchmarks also benefit from equity action.
• At best, WTI and Brent have surpassed USD 86.00/bbl and USD 89.00/bbl respectively thus far.
• Spot Gold remains contained amid relatively rangebound USD action while Silver is buoyed ahead of USD 24.00/oz and touted resistance marks.
• US Private Energy Inventory Data (bbls): Crude -0.9mln (exp. -0.7mln), Gasoline +2.4mln (exp. +2.5mln), Distillates -2.2mln (exp. -1.3mln), Cushing -1.0mln. (Newswires)
• Qatar's Emir is to meet US President Biden on Monday to discuss Afghanistan and contingency plans to supply natural gas to Europe in the event of a Russian invasion of Ukraine. (Axios)
• Qatar Emir and US President Biden are to discuss additional Qatari gas supplies to Europe in the case of a Russian-Ukraine conflict at next week's discussions, via Reuters sources; Qatar has little spare gas for Europe as most gas is pre-sold. (Newswires)

Click here for a detailed summary.

NOTABLE EUROPEAN HEADLINES

• ECB's Simkus says the inflation outlook is no reason to change the path of policy, sees no evidence of significant change to the forecasts. Russian related tensions are a bigger cause for uncertainty than Omicron. (Newswires)
• Sue Gray report, relating to alleged lockdown breaches at Downing Street, will "100%" be handed over to UK PM Johnson today, via BBC's Goodall; Gray has reportedly already briefed No. 10 on the contents and it is "not good news". (BBC)

CRYPTO

• Crypto markets continued to retrace some of the prior day's slump.
• US House Committee is to hold a hearing on digital assets and stablecoin on February 8th. (Newswires)

US-SPECIFIC HEADLINES

• US President Biden will meet with CEOs of Ford (F), GM (GM), Microsoft (MSFT), Siemens (SIE), Corning (GLW) and others on Wednesday regarding Build Back Better. (Newswires)
• US Senate will hold hearings for Sarah Bloom Raskin, Lisa Cook and Philip Jefferson nominations to the Fed board on February 3rd.
• US House Speaker Pelosi will seek re-election. (MSNBC)

Click here for the US Early Morning note.

APAC TRADE

• APAC markets were subdued ahead of the FOMC and holiday-quietened conditions.
• Nikkei 225 (-0.4%) oscillated around the 27k level after record daily COVID-19 cases.
• KOSPI (-0.4%) faded opening gains with attention on earnings.
• Hang Seng (+0.2%) and Shanghai Comp. (+0.7%) were mixed as PBoC liquidity efforts and government support signals were offset as Evergrande default woes resurfaced.

NOTABLE APAC HEADLINES

• PBoC injected CNY 200bln via 14-day reverse repos with the rate at 2.25% for a CNY 100bln net injection. (Newswires)
• US House Speaker Pelosi released the China competitiveness bill related to investments in semiconductors and supply chains. (Newswires)
• Evergrande (3333 HK) offshore bondholders did not receive dollar coupon payments due Monday and the Co. is to hold investor call with financial advisers today at 13:00GMT/08:00EST. (Newswires)
• BoJ Summary of Opinions from January meeting stated consumer inflation is likely to gradually accelerate as more firms pass on costs to households and the output gap improves but noted that it's hard to achieve BoJ's price target by end of fiscal 2023. Furthermore, it stated that consumer inflation may temporarily approach 2% from April onwards although key is whether the economy has momentum for such a move to be sustainable, while it reiterated the BoJ must take additional easing steps as needed and it is appropriate to maintain current forward guidance on interest rates and monetary base commitment. (Newswires)

GEOPOLITICS

• Click here for the newsquawk analysis piece on Russian-related geopolitics.
• US State Department said the US hasn't seen the de-escalation that is necessary if diplomacy and dialogue with Russia is to prove successful, while US Department of Defense Spokesman Kirby said the US will not rule out adding further troops to the already 8,500 on alert. (Newswires)
• Ukraine Foreign Ministers says the proposals the US will send to Russia do not raise Ukraine's objections; subsequently, Moscow says received some answers to security guarantee proposals, but not in written form - awaiting further details. (Newswires/Sputnik)
• Ukrainian President Zelensky said the situation in the east is under control and they are working to establish that the meeting of Presidents of Ukraine, Russia, Germany, and France takes place as soon as possible. (Newswires)
• Russian navy has commenced large-scale training in the Black Sea, according to Ifax. (Newswires)
• UK Foreign Minister Truss, when question if they would sanction Russia's Putin, says they are not ruling anything out. (Newswires)
• Ukraine envoy to Japan said that they are fully committed to a diplomatic solution to the current tensions with Russia, while the envoy also stated that a full-scale war is very difficult to expect although they may see more localised conflict. (Newswires)