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US Market Open: Sentiment supported amid the most upbeat Ukraine/Russia assessment yet

  • Russian and Ukrainian officials on Sunday gave their most upbeat assessments so far on the progress of talks and suggested there could be positive results within days
  • European bourses are firmer, Euro Stoxx 50 +2.1%, following a mixed APAC handover amid conflicting headlines; US futures are firmer across the board but with magnitudes more contained
  • DXY and FX-havens continue to pull back with EUR finding support amid noted expiries but is yet to test 1.10
  • Amid this pullback, core debt is depressed and yields have extended further, US/German 10yrs above 2.05% and 0.33% respectively
  • WTI and Brent continue to unwind geopolitical premia, benchmarks lie near fresh lows of USD 103.42/bbl and USD 107.59/bbl respectively
  • Looking ahead, highlights include Eurogroup Meeting and US-China talks in Rome (ongoing)

As of 10:20GMT/06:20EDT


  • Eurogroup Meeting and US-China talks in Rome (ongoing).
  • Note; US Clocks Changed to EDT from EST on Sunday, March 13th. London to New York time gap is four-hours until the UK change on March 27th.
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  • Russian and Ukrainian officials on Sunday gave their most upbeat assessments so far on the progress of talks and suggested there could be positive results within days. The Ukrainian negotiator reiterated they will not concede in principle on any positions and that Russia now understands this, while he added that Russia is already beginning to talk constructively. Furthermore, the Russian delegate said talks with Ukraine may soon produce draft agreements and US Deputy Secretary of State Sherman commented that Russia showed signs of willingness to engage in substantive negotiations about ending the conflict.
  • Ukraine Presidential adviser says the next round of discussions with Russia will be on peace, ceasefire, immediate withdrawal of troops and security guarantees. Note, talks began around 08:30GMT/04:30EDT
  • Ukrainian President Zelensky said some small towns in Ukraine do not exist anymore due to the war and that negotiations must start with a ceasefire, while he added that the west is not involved enough in peace negotiations and he doesn’t see a common consensus to accept Ukraine in NATO. Furthermore, Zelensky called for software giants to stop supporting their products in Russia.
  • Ukrainian Foreign Minister Kuleba said on Saturday that they are ready to negotiate but won’t surrender and that more needs to be done to hit the Russian economy, while he added that they have to remain open to diplomacy and that they are talking, but Russia continues to put forward demands that are unacceptable to Ukraine.


  • Russian Foreign Ministry official said the EU faces soaring energy prices in the wake of sanctions imposed against Moscow and the situation on global energy markets will lead to the EU paying at least three times more for oil, gas and electricity, while the official added Russia is prepared for a tough confrontation with the EU in the energy sector if necessary, according to Interfax.
  • Ukraine’s atomic energy ministry said power was restored at the Chernobyl nuclear power plant and that cooling systems for spent nuclear assemblies at the plant will operate normally without using backup power.
  • EU ambassadors met in Brussels on Sunday to discuss a proposed list of individuals being targeted in the latest round of sanctions with Roman Abramovich one of the 15 individuals being considered, according to FT.
  • Australia announced new sanctions affecting 33 Russian oligarchs and family members.
  • Russian Finance Minister Siluanov said Russia will fulfil its state debt obligations and pay in RUB until state reserves are unfrozen. Siluanov said sanctions have frozen around USD 300bln in Russian gold and forex reserves, while he added that western countries are pressuring China to limit Russian access to its Yuan reserves, according to Reuters and Ria. Furthermore, Reuters noted that Russia is due to pay USD 117mln on two dollar-denominated bonds on Wednesday and is signalling it may default or pay it in RUB.
  • Russia’s central bank decided to not resume trading of the stock market on the Moscow Exchange between March 14th-18th.
  • UK Chancellor Sunak said he is urging firms to think carefully about investments in Russia and how they may aid President Putin’s regime, while Sunak added that he is clear that there is no case for new investment in Russia.
  • India is considering a Russian offer to sell oil and other commodities at discount amid sanctions, according to officials.


  • US officials said Russia requested military equipment from China to support its invasion of Ukraine, which the White House fears is a sign of increasingly close ties between Beijing and Moscow. However, the Chinese Embassy in the US said that the high priority now is to prevent the tense situation from escalating or getting out of control and a spokesperson said they “never heard of that” when asked about the report of Russian request for military assistance.
  • Subsequently, Chinese Foreign Minister is to arrive in Moscow on March 15th, according to Russian media citing Iranian sources via Sky News Arabia.
  • US President Biden spoke with French President Macron on Ukraine in which they underscored their commitment to hold Russia accountable for its actions and support the government and people of Ukraine, according to the White House
  • Ukraine’s International Peacekeeping and Security Centre in Yavoriv, near the Polish border was bombed and the Russian Defence Ministry said it attacked the training facility in Yavoriv in western Ukraine, which was being used to store military equipment that had been delivered from foreign nations, according to Interfax and Ria. Furthermore, Ukrainian Defence Minister Reznikov said that foreign military instructors worked at the facility, but it was not clear if any were present at the time of the strike. NATO thereafter confirmed that no personnel were hit by the attack.
  • US Secretary of State Blinken condemned Russia's attack on the International Centre of Peacekeeping and Security in Yavoriv.
  • US National Security Adviser Sullivan said Russian attacks near the Polish border show President Putin is expanding targets and reflects frustration about a lack of progress, while US and allies will continue to escalate pressure on President Putin. Sullivan also said the US is consulting with allies and communicating directly with Russia to warn against the use of chemical weapons and said if Russia takes a shot at NATO territory, it would trigger Article 5 and would bring the full force of NATO in response. Furthermore, Sullivan has communicated to Beijing that US will not allow any country to compensate Russia for losses from sanctions and is to meet with Chinese top diplomat Yang Jie in Rome on Monday.
  • UK Cabinet Minister Gove said the attack on the military centre is a significant escalation, while he added that he wants to explore the option that would allow the use of homes and property of sanctioned individuals for humanitarian and other purposes.
  • UK PM Johnson spoke to Ukrainian President Zelensky in which he outlined support the UK continues to deliver to Ukraine and said that President Putin’s actions were testing not just Ukraine but all of humanity, while he added the UK would continue to pursue more options for bolstering Ukraine’s self-defence.
  • UK Ministry of Defense said Russian naval forces established a distant blockade of Ukraine's Black Sea, isolating Ukraine from international maritime trade, adds Russian naval forces are also continuing missile strikes against targets throughout Ukraine
  • Ukraine said its troops were launching counterattacks against Russian soldiers in Ukraine’s Mykolaiv region and the eastern Kharkiv region.
  • Ukraine NSDC Secretary Danilov said Russia is developing a special operation to disguise Belarusian soldiers in Russian uniform and send them to Ukraine, according to NEXTA.
  • Air raid alerts were reported in at least 19 out of 24 Ukrainian regions, according to Kyiv Independent.


  • Russian prosecutors reportedly warned companies they may seize assets and trademarks of companies that pull back from Russia and may arrest company leaders that criticise the government, according to WSJ. However, the Russian Embassy in the US refuted media claims that western companies are being threatened, according to Sputnik.
  • Iranian Foreign Minister will travel to Russia on Tuesday to meet with Foreign Minister Lavrov, according to a spokesperson cited by journalist Aslani; separately, Iranian Foreign Ministry spokesperson says the US needs to make a decision before a nuclear deal is possible.
  • Iranian Top Security Official says Iran will remain in nuclear discussions until Tehran's "legal and logical" demands are met and a strong deal is reached.
  • Turkey and Greece agreed on talks to improve ties amid the Ukraine conflict.



  • European bourses are firmer, Euro Stoxx 50 +2.1%, following a mixed APAC handover amid conflicting headlines as we await details of the latest Ukrainian-Russia talks.
  • Stateside, US futures are firmer across the board but with magnitudes more contained, ES +0.9%, ahead of multiple risk events.
  • Sectors in Europe are mostly firmer though some of the more defensive names are lagging modestly, Autos outperform post-Volkswagen.

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  • Aussie bears the brunt of reversal in commodity prices; AUD/USD hovering around 0.7250 ahead of RBA minutes tomorrow.
  • Yen extends decline on yield and BoJ policy divergence towards 118.00 vs the Dollar.
  • Euro rebounds with risk appetite amidst hopes of constructive Russian-Ukrainian dialogue; EUR/USD finds support around 1.0900 where 1.84bln option expiries reside to trade above 1.0960.
  • Rouble firmer on the premise that positive words will speak louder than negative actions.
  • Yuan depreciates as Covid cases mount in China and PBoC sets a weaker than expected onshore midpoint rate, USD/CNH probes 6.3800 at one stage.
  • Swedish Crown strong in line with latest inflation data and hawkish Riksbank rate calls from Nordea and SEB, EUR/SEK tests Fib support circa 10.5252.

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Notable FX Expiries, NY Cut:

  • EUR/USD: 1.0900 (1.84BN), 1.0925 (261M), 1.1000 (1.66BN), 1.1050-60 (1.25BN), 1.1145-55 (660M), 1.1165-70 (449M), 1.1190-00 (787M)
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  • Debt rout rages on on as futures take out near term technical supports and yields reach or breach psychological levels.
  • Curves continue to steepen on resurgent risk sentiment rather than any read respite from sharp retracement in crude prices.
  • USTs and Gilts anticipating tightening from the Fed and BoE later this week.

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  • WTI and Brent continue to unwind geopolitical premia amid mixed Russia-Ukraine developments and the possibility of progress soon.
  • Currently, benchmarks lie near fresh lows of USD 103.42/bbl and USD 107.59/bbl respectively, further impeded by IEA's Birol.
  • Iraq set April Basrah medium OSP to Asia at Oman/Dubai + USD 3.50/bbl, OSP to Europe at Dated Brent - USD 3.05/bbl and OSP to North and South America.
  • UK PM Johnson is seeking a mega oil deal with the Saudis and is pushing for solar and nuclear energy to cut reliance on foreign oil, while the UK is also considering keeping some coal-fired power stations operational, according to Express and The Times.
  • IEA Chief Birol says responsible producers should increase oil output.
  • French PM Castex said the government will offer EUR 0.15/litre rebate on petrol prices from April to counter high prices with the rebate on fuel to last four months and is expected to cost around EUR 2bln.
  • Japanese PM Kishida will look at measures for high oil prices and raw material food prices whilst watching the situation carefully, according to the Japanese ruling party secretary general; subsequently, Japanese government is to increase the petrol subsidy to around JPY 24/litre and close to the ceiling of JPY 25/litre.
  • Gazprom says it is continuing shipping gas to Europe via Ukraine, Monday's volume is broadly unchanged at 109.5mln cubic metres; does not intend holding spot gas sale sessions on its electronic sales platform this week.
  • China is planning to boost its coal output by as much as it imports.
  • Spot gold and silver are pressured unwinding safe-haven appeal in-fitting with other typical havens.

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  • Swedish CPIF YY (Feb) 4.5% vs. Exp. 4.1% (Prev. 3.9%); MM (Feb) 0.9% vs. Exp. 0.4% (Prev. -0.5%)
  • Swedish CPIF Ex Energy YY (Feb) 3.4% vs. Exp. 3.1% (Prev. 2.5%); MM (Feb) 1.0% vs. Exp. 0.7% (Prev. 0.1%)

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  • Bitcoin was initially subdued beneath USD 38,000 ahead of an EU vote on environmental sustainability standards measure that could lead to a ban on Bitcoin, but later recovered with support also seen following a tweet from Elon Musk.
  • Elon Musk tweeted "I still own & won’t sell my Bitcoin, Ethereum or Doge fwiw".
  • Japan demanded that cryptocurrency transactions be blocked if they are sanctions related



  • APAC stocks were somewhat mixed as participants digested varied geopolitical headlines ahead of key risk events.
  • ASX 200 was underpinned by strength in its largest-weighted financial sector and encouragement from M&A-related headlines.
  • Nikkei 225 benefitted from further currency weakness but failed to hold above the 25,500 level.
  • Hang Seng and Shanghai Comp. were pressured amid several headwinds, including COVID-19 concerns with the technology hub of Shenzhen under a one-week lockdown, which pressured tech and weighed on Macau casino names, as well as dragged the Hong Kong benchmark beneath the 20K level for the first time since 2016.


  • PBoC injected CNY 10bln via 7-day reverse repos with the rate at 2.10% for a net neutral daily position.
  • PBoC set USD/CNY mid-point at 6.3506 vs exp. 6.3389 (prev. 6.3306)
  • Beijing's health authorities announced it is to expand COVID-19 nucleic acid testing with the capital currently "at a critical stage of epidemic control", according to Global Times.
  • China’s Shenzhen will suspend public transport including buses and subways from Monday, with residents instructed not to leave the city unless necessary, as the city conducts three rounds of mass COVID-19 testing, according to Reuters. Shenzhen also halted dining in at restaurants and shut indoor entertainment venues, while companies should have employees work from home this Monday to Friday if remote working is possible, with exceptions for those in essential sectors.
  • China's Dongguan suspended bus and railway operations, as well as in-person classes due to COVID-19. Furthermore, China's city of Jilin was also partially locked down on Saturday and residents of Yanji were confined to their homes on Sunday.
  • China Securities Journal front-page article stated China could cut RRR and interest rates to stabilise growth, citing analysts.