• APAC stocks eventually traded mostly positive after the firm handover from the US which saw a solid performance for the NDX.
• The PBoC defied expectations for a cut to its benchmark lending rates.
• Netflix shares fell 26% after-hours as subscribers declined for the first time in over a decade.
• European equity futures are indicative of a higher open with Eurostoxx 50 +0.2% after the cash market closed lower by 0.5% yesterday.
• The DXY rally has paused for breath as majors attempt to claw back lost ground with antipodeans leading the charge. 
• Looking ahead, highlights include German PPI, EZ Industrial Production, Canadian CPI, US Existing Home Sales, French Election TV Debate, Speeches from Fed's Daly & Evans, Supply from UK, Germany & US, Earnings from ASML, Carrefour, Danone, Heineken, Sandvik, Abbott, P&G and United Airlines

US TRADE

• SPX +1.63% at 4,463, NDX +2.15% at 14,210, DJIA +1.45% at 34,911, R2K +2.04% at 2,030.
• US stocks notched a solid performance with NDX and Russell 2k outperforming SPX and with Ukraine an afterthought to the bounce in housing data and lack-of-concerning macro commentary from corporates.

Click here for a detailed summary.

NOTABLE US HEADLINES

• Fed's Evans (2023 voter) said there is good reason to think the economy will do very well even as rates rise and they could get to a 2.25-2.5% neutral rate by year-end if they were to do a couple of 50bps hikes. Evans said that if they do not see inflation coming down, they are going to raise rates above neutral and that the expectation is that they will need to raise rates above neutral, while he later stated that he doesn't see the need for larger than 50bp rate hikes, according to Reuters.
• Fed's Kashkari (2023 voter) said the economy may still be vulnerable to new COVID waves and that inflation is far too high, while he added the Fed's job will get harder and they will need to do more to bring inflation down if supply chains don't improve as he hopes, according to Reuters.
• Fed's Bostic (2024 voter) said it is important to get to a neutral rate (2-2.5%) expeditiously and that real wages are in retreat so there is a case to be made that they will not have to push as hard. Bostic added any action is possible although a larger 75bps hike is "not on the radar", while a cut to global growth is a sign the Fed needs to be cautious and a reason not to rush beyond neutral, according to CNBC.
• US President Biden's administration will appeal the ruling against the CDC travel mask mandate, according to Bloomberg.
• Netflix Inc (NFLX) - Q1 2022 (USD): EPS 3.53 (exp. 2.89), Revenue 7.87bln (exp. 7.93bln), Net Subscriber Additions: -0.2mln (exp. +2.5mln). Q1 UCAN streaming paid net change -640k (exp.+87.5k). Co. lost 640k subscribers in US/Canada, 300k in EMEA, and 350k in LatAm. Co. Said macro factors, including sluggish economic growth, increasing inflation, geopolitical events such as Russia’s invasion of Ukraine, and some continued disruption from COVID are likely having an impact, via PR Newswire. Click here for the full breakdown. Shares fell 25.7% after-market

GEOPOLITICS

RUSSIA-UKRAINE

DEFENCE/MILITARY

• Russian troops seized the village of Kreminna in the separatist Luhansk region to claim the first ‘victory’ in its renewed offensive for Donbas, according to The Telegraph.
• Ukraine said Russia is hitting Mariupol's Azovstal factory with anti-bunker bombs, according to Reuters. However, Russia's Defence Ministry later said it will set a ceasefire in the area of Ukraine's Azovstal steel plant for April 20th, according to RIA.
• US senior official sees Russia carrying out a prelude to larger, expected offensive operations in eastern Ukraine. The official stated Russia is still adding to its military capabilities to prepare for the offensive, introducing two additional battalion tactical groups (BTG) in the past 24 hours, while about seven US flights of weapons are heading to Europe in the next 24 hours carrying weaponry for Ukraine, according to Reuters.
• US President Biden said the US will send more artillery to Ukraine, while multiple sources also said President Biden is to announce another large military aid package for Ukraine, according to Reuters.
• German Chancellor Scholz said they will continue to finance Ukraine militarily and financially, while he noted that western leaders agreed they will have maximum support to Ukraine but not get involved in the war. Scholz added that they reached the limit of what they can deliver from the German armed force's own stocks but with their partners, will help provide long-range artillery to Ukraine, according to Reuters.

SANCTIONS/ENERGY

• White House said there could be new sanctions on Russia this week, according to Reuters.
• US Treasury issued a general license to allow certain transactions by sanctioned persons and financial institutions relating to NGO activities in Russia and Ukraine, according to Reuters.
• US has increased pressure on China and India for refusing to join Western sanctions against Moscow and is threatening to punish businesses that provide services to Russian airlines flying to Beijing, Delhi and other destinations, according to the Nikkei.
• India is to increase its Russian oil purchases, according to Sputnik citing reports.
• US President Biden is reportedly being urged by lawmaker Steve Cohen to impose a travel ban on UK lawyers that acted on behalf of Russian oligarchs attempting to silence investigative journalists, according to FT.

FUND/OTHER

• CBR eased FX currency controls measures for Russian export-focused companies excluding commodities and the energy sector.
• Saudi Arabia reportedly seemed to be leaning closer to the Kremlin over the Ukraine invasion, according to a Biden administration source in the WSJ.

OTHER

• US officials are to visit the Middle East this week to de-escalate Jerusalem tensions, according to Sputnik.

APAC TRADE

EQUITIES

• APAC stocks eventually traded mostly positive after the firm handover from the US despite continued upside in yields.
• ASX 200 was led by the healthcare sector as shares in Ramsay Health Care surged due to a takeover proposal from a KKR-led consortium, but with gains capped by miners after Rio Tinto's lower quarterly iron ore production and shipments.
• Nikkei 225 was underpinned by the initial currency depreciation and with the BoJ defending its yield cap.
• Hang Seng and Shanghai Comp were mixed with the mainland subdued after the PBoC defied expectations for a cut to its benchmark lending rates and instead maintained the 1yr and 5yr Loan Prime Rates at 3.70% and 4.60%, respectively.
• US equity futures were pressured after Netflix shares fell 26% as subscribers declined for the first time in over a decade.
• European equity futures are indicative of a higher open with Eurostoxx 50 +0.2% after the cash market closed lower by 0.5% yesterday.

FX

• DXY faded some of its recent advances after momentarily climbing above the 101.00 level and despite gains in yields.
• EUR/USD found reprieve from the greenback's reversal and reclaimed the 1.0800 handle.
• GBP/USD gained a firmer footing above 1.3000 after moving as low as 1.2981.
• USD/JPY initially climbed above 129.00 before reversing course and which prompted further jawboning by officials.
• Antipodeans benefitted from the softer greenback although briefly wobbled after the PBoC set the weakest CNY reference rate since November last year.
• SNB Chairman Jordan said Swiss inflation expectations are well anchored but there could be some risk to price stability in Switzerland. Jordan said the largest impact on price stability in Switzerland comes from energy prices and supply chain woes, while he added that a substantial amount of inflation today may be temporary, according to Reuters.

FIXED INCOME

• 10yr UST futures were somewhat choppy but ultimately extended declines as yields continued to move higher and which saw the 10yr treasury real yield turned positive for the first time since 2020.
• Bunds remained subdued beneath 154.00 but moved off worse levels after support held at yesterday’s trough.
• 10yr JGBs pared some of their opening losses amid the BoJ’s presence in the market under its regular bond purchases and it also announced a special operation for unlimited JGBs at a fixed rate after the 10yr JGB yield rose to the 0.25% cap.

COMMODITIES

• Crude futures attempted to nurse some of their recent losses but with the recovery limited following IMF's global growth downgrades and improved supply backdrop out of Libya, while mixed private inventory data had little effect on prices.
• US Private Energy Inventory Data (bbls): Crude -4.5mln (exp. +2.5mln), Cushing +0.1mln, Gasoline +2.9mln (exp. -1.0mln), Distillate -1.7mln (exp. -0.8mln).
• Iraq said it is committed to OPEC+ oil increases, according to State News Agency.
• Spot gold languished near the prior day's lows and failed to benefit from despite the dollar pullback.
• Copper remained lacklustre amid the ongoing lockdowns affecting its largest purchaser China.

CRYPTO

• Bitcoin prices were little changed and marginally softened below the 41,500 level.
• Russia may consider using crypto in foreign trade, according to Izvestia

NOTABLE APAC HEADLINES

• 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 6.3996 vs exp. 6.3853 (prev. 6.3720)
• PBoC 1-Year Loan Prime Rate (April) 3.70% vs. Exp. 3.65% (Prev. 3.70%)
• PBoC 5-Year Loan Prime Rate (April) 4.60% vs. Exp. 4.55% (Prev. 4.60%)
• PBoC said it is to step up financial support for COVID control, as well as smooth logistic and supply chains. PBoC added that it will make good use of financial policies to support the service sector, consumption investment and small firms. Furthermore, it will keep the property sector financing stable and orderly, while it will flexibly adjust mortgage payment plans for home buyers impacted by COVID-19, according to Reuters.
• Shanghai official said the epidemic situation in the city has shown a downtrend in recent days and that two districts achieved zero covid at the community level. Furthermore, the number of people categorised in highest risk "sealed areas" has reduced significantly, although 11.9mln residents are still confined to their homes under lockdown measures, according to Reuters and Bloomberg.
• Japan is considering handouts to low-income households with children, according to Asahi.
• BoJ offers to buy an unlimited amount of 5yr-10yr JGBs at a fixed rate of 0.25%, after the 10yr JGB yield touched the BoJ's yield cap.

DATA RECAP

• Japanese Trade Balance (JPY)(Mar) -412.4B vs. Exp. -100.8B (Prev. -668.3B, Rev. -669.7B)
• Japanese Exports YY (Mar) 14.7% vs. Exp. 17.5% (Prev. 19.1%)
• Japanese Imports YY (Mar) 31.2% vs. Exp. 28.9% (Prev. 34.0%, Rev. 34.1%)

UK/EU

• UK government said the Competition and Markets Authority will be able to directly enforce consumer law and will have new powers to fine firms up to 10% of global revenue for mistreating customers, according to Reuters.
• UK plans to extend tariffs on glass fibre from China used in electric vehicles and wind turbine blades to protect the domestic market, according to SCMP.