Overnight Highlights
Japan’s real GDP rose 12.7% YoY in Q4 2020 vs. 9.5% expected and 22.9% previously, indicating that The Japanese economy is recovering from the impact of the new crown Epidemic and the Nikkei 225 stock index recovered the 30,000-point mark for the first Time since 1990.
Eurozone industrial output in December -0.8% year-on-year, weaker than the expected -0.2% and the previous value of -0.6%. Eurozone industrial output in December was -1.6% YoY, also weaker than the expected -0.8% and the previous value was revised from 2.5% to 2.6%. According to CCTV, Eurostat said China overtook the US as the EU’s largest trading partner last year, with the UK in third place.
The spread of the epidemic in the U.S. slowed, with the average daily number of new confirmed cases in the latest week less than 100,000, the lowest since last October. Senior health officials in the Biden administration said about 4 percent of confirmed cases in the U.S. are infected with the mutated virus, which is expected to become the dominant strain as early as March.
British Prime Minister Johnson plans to set a target date to end the national lockdown, the country’s new crown confirmed since early October last year for the first time below 10,000 cases, France’s new crown virus test positive ratio fell to 6%, Germany began to implement border controls, the auto industry concerns caused by plant shutdown.
S&P futures hit a record high, European stocks closed higher and led by British stocks, led by basic resources and banking stocks
New crown vaccine in the world’s major countries successfully launched and the United States is about to come out with a new round of massive fiscal stimulus, are raising expectations for economic recovery, Japan, South Korea and other Asia-Pacific stock indexes and international oil prices have both surged.
At the end of Monday’s European session, the three major U.S. stock index futures maintained gains and were up more than 0.4%, with the S&P 500 futures hitting an all-time high. The FTSE China A50 futures maintained gains of more than 0.1%, and the MSCI Asia Pacific equity index, excluding Japan, also hit an all-time high. Global equities saw 11 straight gains, the longest consecutive up cycle since 2009.
European stocks opened higher, with all sectors and national stock indices rising, with media stocks leading the broader pan-European index with a 3.8% gain, and the Stoxx 600, France’s CAC and Spain’s IBEX all up more than 1%. Britain’s FTSE 100 index rose more than 2%, and the British pound also advanced, mainly boosted by the news that the UK’s new crown vaccination exceeded 15,000,000 times.
As of the close, the European STOXX 600 index closed up 1.32% at 419.47 points, including the basic resources index rose 4%, the oil and gas index rose nearly 4%, the banking index rose 3.10%, the technology index rose 0.84%, the auto parts index rose 0.48%.
Germany’s DAX 30 index closed up 0.42% at 14,109.48 points. France’s CAC 40 index closed up 1.45% at 5786.25 points. Britain’s FTSE 100 index closed up 2.52% at 6756.11 points. Italy’s FTSE MIB index closed up 0.83% at 23,604.31 points
Among key stocks, French media giant Vivendi rose more than 19%, with shares hitting a more than decade-high since May 2007. The company plans to spin off its biggest business, Universal Music Group (UMG), for a separate listing through Euronext Amsterdam by the end of the year and distribute 60% of its capital to shareholders. French transport group Bollore, which holds a stake in Vivendi, rose more than 14%.
International oil prices rise over 2% to a 13-month high as supply tightens, US oil WTI nears $61
International oil prices set a new 13-month high, returning to pre-epidemic levels. Brent April Crude Oil futures closed up $0.87, or 1.39%, at $63.30/barrel.
U.S. oil WTI rose as high as $1.48 or 2.5% during the day to a daily high of $60.95, surpassing $60 and approaching the $61 round figure, a new high of more than a year since January 8, 2020, and has accumulated a 24% gain so far this year.
International Brent rose as much as $1.33 or 2.1% during the day to a daily high of $63.76, a 13-month high since Jan. 22, 2020, and stood firm above the $63 level. International oil prices have risen more than 50% since last November due to tightening supply.
Russian Deputy Prime Minister Novak said the global crude oil market is on the road to recovery, with oil prices likely to average $45 to $60 per barrel this year; the low volatility of oil prices over the past few months suggests the market is already in balance. In the latest news, Russian President Vladimir Putin and Saudi Crown Prince Salman will talk on the phone to discuss OPEC+ cooperation, and both sides agreed to continue close cooperation to stabilize the global energy market.
Cold weather has caused winter storm warnings to be issued for parts of southern Texas for the “first time in a decade,” and media say oil production in the Permian Basin has fallen by 1 million barrels per day, with the largest U.S. refinery shutting down due to the cold weather and disruptions in energy supply involved in pushing up oil prices.
Oil prices are also being affected by tensions in the Middle East. The Saudi-led group in Yemen said it intercepted an explosive-laden drone launched by Iran-aligned Houthis. In addition, workers at Norway’s largest oil loading terminal decided today whether to strike this week, potentially disrupting production at fields that account for 1/3 of the country’s crude output, all factors involved in boosting oil prices.
Higher U.S. bond yields depress Gold prices, platinum rises above $1,300 for the first time in 2014, and copper hits another eight-year high
Recent overall higher U.S. bond yields have increased the opportunity cost of holding gold despite a weaker dollar. Gold prices fell on Monday, with spot gold falling as deep as 0.5% during the day, forcing a daily low under $1816.
But platinum futures rose above $1,300 per ounce for the first time since 2014, setting a new high of more than six years, and spot platinum also rose more than 4%, rising above the $1,300 round figure and rising for three days, mainly due to supply-side shortages. Chemicals giant Johnson Matthey believes platinum, the precious metal used to filter car engine exhaust emissions, could see a third straight annual supply shortfall in 2021.
Risk sentiment was higher and London base metals generally closed higher. LME copper futures closed up $62 at $8,394 per tonne, another eight-year closing high. LME tin futures closed up $735 at $24,385 per tonne, another more than six-year high.
LME zinc futures closed up $8 at $2,842/ton. LME lead futures closed up $5 at $2,124/ton. LME nickel futures closed up $54 at $18,623/ton. LME cobalt futures closed flat at $47,000/ton. LME aluminum futures closed down $6 at $2,084/ton.
Dollar at nearly two-week low, offshore yuan at highest since June 2018, bitcoin retreats from new high
The dollar index fell as deep as 0.2% on Monday to a daily low of 90.27, close to a two-week low since Jan. 27 of 90.25 hit last week.
Analysts noted that the dollar index had touched a two-month high of 91.6 on Feb. 5, mainly due to expectations that the U.S. economic recovery would outpace other major economies, but fell back after poor non-farm payrolls data in January, with markets worried about the slowing pace of the U.S. recovery.
The euro gained a modest 0.1% against the dollar, standing steady above 1.21, extending last week’s 0.6% gain. The dollar rose 0.4% against the yen to return above 105, erasing part of last week’s cumulative loss of 0.4%. The British pound rose above 1.39 against the dollar, setting a new three-year high.
The Australian dollar hit a one-month high against the dollar, and the Turkish lira rose 1% against the dollar. The offshore yuan pushed up against the dollar to the 6.40 mark, the highest again since June 2018. The dollar was down 0.5% against the Canadian dollar at 1.2631.
Bitcoin set a new all-time high of $49,716 on Sunday (Feb. 14), then fell below $46,000 during the Asian and European stock markets, before closing back above $48,000 in Europe, narrowing its intraday loss to 0.4%.
Demand from large payment companies, banks, tech giants like tesla and institutional investors has pushed up the price of bitcoin, which has risen 40% in February alone and 25% last week. The latest news says an investment arm of Morgan Stanley is considering whether to invest in bitcoin.
Ether, the second-largest digital cryptocurrency by market capitalization, once fell more than 4%, pushing down to $1,700, before turning back up after the European share close and regaining above the $1,800 round figure, having risen to an all-time high of nearly $1,875 on Saturday (Feb. 13).
Dogcoin narrowed its intra-day decline to nearly 3% after the European stock market closed, trading at 5.7 cents per coin. After a frenzy of “bandwagoning”, Tesla CEO Musk accidentally encouraged big dogcoin players to sell on social media on Monday, and dogcoin once plunged 23% in response, falling below 5 cents per coin.
U.S. bonds closed for the day, “reflationary trading” to the general upward movement of European bond yields
The 10-year German bond yield rose by nearly 1 basis point to a daily high of -0.376%, a rebound of nearly 3 basis points from the daily low. 10-year British bond yield rose by more than 2 basis points to a daily high of 0.593%.
On Friday, the 10-year U.S. bond yield hit another nearly 11-month high since March last year, the 30-year U.S. bond yield broke back above 2%, U.S. Inflation expectations touched a six-year high, and the U.S. bond yield curve was near its steepest in five years.
Some analysts say investors are betting that U.S. fiscal stimulus and vaccines will drive economic recovery, and that the “reflation trade” (reflation trade) will continue, with U.S. bond yields likely to move further higher and cyclical stocks continuing to catch up with the broader market’s previous gap.
Goldman Sachs said, as the global asset pricing anchor, the most likely catalyst for the current rapid recovery in U.S. real interest rates, one is “policy-driven” from the market’s expectations of monetary and fiscal policy shift, the second is “growth-driven” from the market on economic The second is “growth-driven,” which comes from the market’s response to improved economic growth, but it is important to know which one is dominant.
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