Remarks conveyed by Russian state media, RIA, comments from a foreign ministry official:
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rssCOVID-19 outbreak is hitting Shanghai “harder than authorities have publicly disclosed”
Via the Wall Street Journal (Journal is gated but there is the link if you can access it):
- Many patients have died in recent days at a large Shanghai elderly-care hospital that is battling a Covid-19 outbreak, according to people familiar with the situation, a sign that a new wave of infections is hitting China’s financial capital harder than authorities have publicly disclosed.
- Shanghai’s government hasn’t reported any Covid-related deaths or outbreaks in its hundreds of elderly-care centers since cases began climbing in the city in March.
Thought For A Day
IEA to make OPEC+ oil output estimates publicly available to support transparency
This comes after OPEC+ removed IEA estimates as a secondary source earlier today here.
The funny thing about OPEC+ being unhappy about IEA’s supposed “bias” here is that even within the bloc itself, they can’t trust the quality of data produced by its own members – which is why they are reliant on secondary sources. Irony.
JP Morgan shift from expecting 25bp hikes in May and June to 50bps in each
J.P. Morgan’:
- We are now replacing our expectations for 25bp hikes in May and June with 50bp moves
- reverting to 25bp hikes in July and thereafter
JPM project the ‘terminal’ funds rate just below3% in 2023.
JPM reasoning is “Powell’s latest pivot“:
- The median dot from the March 16th dot plot showed the equivalent of seven 25bp hikes this year.
- Speaking on March 21st Chair Powell said “each [dot plot] reflects a point in time and can become outdated quickly at times like these.” To prove his point, he followed this up with “if we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so.”
- This sentiment was soon echoed by a chorus of Fed officials, including some traditional doves.
- It’s hard to see what happened between March 16th and March 21st to motivate this change, certainly not economic data, and it’s unlikely there were enough surprises on the geopolitical front. Perhaps the market’s nonchalant response to the somewhat hawkish outcome of the FOMC meeting gave the Committee the opening to signal a faster tightening pace.
IEA and OPEC+ spat … Opec removes IEA as an information source
On a separate matter, the Paris-based energy watchdog the International Energy Agency (IEA) had been critical of Opec+, saying it is not doing enough to help tackle high energy prices.
- IEA executive director Fatih Birol described the group’s decision to stick with a 400,000 b/d increase in its April crude quota as “disappointing”.
Opec now hits back:
- has removed the IEA from the panel of “official” secondary sources that monitor the group’s monthly crude production
- The agency has been replaced by consultancies Wood Mackenzie and Rystad Energy, which join Argus, the US’ Energy Information Administration, S&P Global Platts, IHS Markit and Energy Intelligence.
Stocks snap winning streaks today. S&P snaps 4-day streak. Nasdaq 2-day streak snapped
The major indices all declined today with the NASDAQ and Russell 2000 leading the way to the downside. In moving lower, the major indices all snapped winning streaks:
- S&P and Dow industrial average snapped their 4-day up streaks
- NASDAQ index snapped it two day up streak
- Apple, the bellweather for the big cap stocks, snapped it’s 11 day up streak.
The final numbers are showing:
- Dow industrial average fell -65.40 points or -0.19% at 35228.82
- S&P index fell -29.15 points or -0.63% at 4602.46
- NASDAQ index fell -177.35 points or -1.21% at 14442.28
- Russell 2000 fell -42.02 points or -1.97% at 2091.06
Looking at the S&P sectors, the winners today were led by:
- Energy, +1.2%
- Utilities, +0.8%
- Healthcare, +0.2%
The laggards today included:
- Consumer discretionary -1.5%
- Technology, -1.4%
- Communications -0.8%
Thought For A Day
The Ruble is back. All post invasion losses erased. Amazing what gold backing can do.
Rally for equities, credit on Ukraine-Russia case-fire talks will not be sustained Morgan Stanley view
Morgan Stanley’s Head of U.S. and European Credit Strategy Srikanth Sankaran speaking in an interview with Bloomberg TV. In a nutshell:
- rally in equity and credit markets on optimism about progress in cease-fire talks between Russia and Ukraine is just a temporary blip
- “The focus will definitely shift back to the central bank hawkishness”
- rally is “likely to fade over the near term,” … as the market starts to price in the magnitude of the Fed’s upcoming rate hikes.
US S&P: