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Livesquawk - US Briefing - Thursday 06.01
US Briefing - Thursday 06.01
Headlines
  • Jobless Claims Expected To Hold Near Historic Lows In Tight Labour Market
  • Money Markets Ramp Up ECB Rate Hike Bets Again, 15Bps By Year End
  • German Factory Orders Rise In Boon For Pandemic-Stricken Economy
  • French Parliament Approves President Macron's Vaccine Pass
  • Omicron Pushes UK Services PMI To 10-Month Low - IHS Markit
  • UK Firms Expect To Raise Prices 5% In Next Year In A BoE Poll
  • House Of Commons Leader Urges UK PM To Cut Taxes As UK Costs Rise
  • UK Consumer Spending Falls Sharply By 40% In Christmas Week VS Prior
  • US 10-Year Treasury Yield Tops 1.72% Amid Focus On Fed Tightening
  • Hawkish Fed, German Inflation Push 10-Year Bund Yield Up Closer To 0%
  • Dollar Basks In Fed Minutes Glow, Climbing Towards 14 Month High
  • Bitcoin, Ether Near Multi-Month Lows Following Hawkish Fed Minutes
  • Oil Rises Sharply, Extending Rally On Kazakhstan Unrest, Libyan Outages
  • Nasdaq’s $1 Trillion Rout Fuels Concern Of A Bumpy Ride In 2022
  • India Medical Agency Flags ‘Major’ Worries Over Merck Covid Drug
  • Asia Tech Stocks Fall Following The US Sell-Off And Fed Warning
Commentary
Jobless Claims Expected To Hold Near Historic Lows In Tight Labour Market

The number of people filing for unemployment benefits is estimated to have held near five-decade lows last week as firms struggle to remain fully staffed amid a resurgent pandemic.

 

Economists surveyed by The Wall Street Journal expect Thursday’s Labour Department report to show initial jobless claims, a proxy for layoffs, totalled a seasonally adjusted 195,000 for the week that ended Jan. 1. That would keep the four-week average for claims, which smooth's out volatility, near last month’s level, the lowest since 1969. The claims data will be released at 8:30 a.m. ET. (Continue Reading – WSJ)

Market Rates Take The Minutes As A Cue To Keep Motoring Higher

Both ends of the curve have ratcheted higher in response to the minutes. A flatter curve has also been a notable outcome; rate hikes are coming. Policy tightening acceleration has acted to push the 2yr yield well north of 80bp, and the 10yr has hit 1.7%. The latter has been driven by a rise in real yields. The 10yr real yield remains deeply negative (at -90bp), as nominal rates remain well below inflation expectations, but it is up 20bp since the beginning of the year, and just today up by almost 10bp. This is important, as rises in the real yield go hand in hand with an improved macro outlook. Inflation expectations have fallen, which is what would be expected from a more hawkish Fed that is increasingly prepared to act. (Continue Reading – ING)

Dems Shift Gears On Russian Pipeline, Backing Biden Against Cruz’s Gambit

Top Senate Democrats have long opposed a Russian natural gas pipeline that’s set to enrich Vladimir Putin. But those lawmakers are putting those concerns aside to back up President Joe Biden as he navigates increasingly precarious talks with Moscow.

 

Democrats have consistently supported sanctions on the Nord Stream 2 pipeline, arguing that the project will jeopardize Europe’s energy security and allow Putin to blackmail his enemies. But as the Senate prepares to vote next week on legislation from Sen. Ted Cruz (R-Texas) that would force Biden to impose those sanctions, Democrats on Wednesday signalled a significant shift in their posture. (Continue Reading – Politico)

Heaviest Tech Selling In A Decade Fuelled Stock-Market Rate Rout

The hammering in technology stocks that began to spread into the broader market Wednesday is being fuelled by one of the most intense bouts of selling by professional speculators since the financial crisis.

 

Hedge funds, which spent December unloading high-growth, high-valuation stocks, began the new year by jettisoning software and chipmakers at a furious pace. During the four sessions through Tuesday, these sales reached the highest level in dollar terms in more than 10 years, data compiled by Goldman Sachs Group Inc.’s prime broker show. (Continue Reading – Bloomberg)

Global Food Costs Ease From Near Record, Offering Inflation Respite

Global food prices declined from near a record high at the end of last year, offering some respite to consumers and governments facing a wave of inflationary pressures.

 

A United Nations index tracking everything from grains to meat fell 0.9% in December, potentially helping to ease the run-up in prices of grocery store products. Still, the gauge remains near 2011’s all-time high and average prices jumped about 28% in 2021, the most in 14 years. (Continue Reading – Bloomberg)

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