Treasury yields are continuing to keep higher on the session, with 10-year yields up 3.4 bps to 1.735%. Meanwhile, 30-year yields are up almost 4 bps to 2.126% as the post-FOMC meeting minutes selloff holds.

The chart above remains a key one to watch as 10-year yields are close to testing resistance at 1.75% and its 200-day moving average (blue line) at 1.79%. That is yet another critical region before a potential surge towards the December 2019 highs around 1.97% and the 2.00% mark.

In the equities space, European indices are still largely more subdued. The majors are down by roughly 1% so that is keeping risk sentiment more on the defensive for the time being. Elsewhere, US futures are faring slightly better from earlier but tech remains a notable laggard. Dow futures are up 0.3%, S&P 500 futures flattish, while Nasdaq futures are down 0.3%.

Meanwhile, the dollar is keeping steadier for the most part alongside the yen though earlier gains have been trimmed somewhat. AUD/USD is down to 0.7170 but off earlier lows of 0.7145. USD/CAD is up 0.2% to 1.2772 but off earlier highs of 1.2810.

In the commodities space, gold is still pinned lower just below $1,800 while oil has seen an impressive turnaround to be up over 1% to just below $79 at the moment.

Looking ahead, US weekly jobless claims will be one to watch. Otherwise, expect the focus to stay on the risk mood and bond yields before we get to the NFP release tomorrow.

• North Korea said Thursday that it has conducted a test-firing of what it called a “hypersonic” missile
• North Korean leader Kim Jong-un did not attend the firing.
• The North conducted the first test-firing of the “hypersonic” missile Hwasong-8 in September last year, though the South Korean military have said it appeared to be at an early stage of development.

See the link to Yonhap above for more

Also re aviation in China in response to recently surging cases numbers:

• Hong Kong has suspended flights from 8 countries
• Macau has tightened its entry requirements for international air arrivals after announcing a 14-day ban on all civilian flights from foreign countries.

A reduction in flights has implications for oil demand.

Nikkei:

• The Bank of Japan’s government debt holdings have fallen for the first time in 13 years as the central bank quietly adjusts its massive bond-buying program in the face of looming financial risk.
• The BOJ’s balance of Japanese government bonds totaled 521 trillion yen ($4.49 trillion) at the end of 2021, according to data released Wednesday, down 14 trillion yen from a year earlier.

Down from an eye-watering 535 tln to a marginally less euye-watering 521 tln.

There is plenty more at the piece, link here (may be gated)

Nikkei says the motivation for the reduce tion was ‘tackling risk’