Nasdaq Jumps Most in 4 Months in Risk-on Revival

Investors poured back into the market’s riskiest assets Tuesday as dip-buyers powered the Nasdaq 100 to its biggest rally since November and sent Bitcoin back toward a record. Treasuries added to gains after a note auction. The S&P 500 rose by 1.42% to 3,875.44 while Dow Jones was up 30.30 points (0.095%) to 31,832.74.

US Stimulus Set to Turbocharge World Economy as Europe Lags

A US recovery turbocharged by President Joe Biden’s stimulus package will help power a faster than expected global economic upswing that risks leaving Europe behind, according to OECD forecasts. The Paris-based organization said it now expects global output to rise above pre-pandemic levels by mid-2021 after major economies showed greater resilience at the end of 2020, and as evidence of vaccine efficacy grows and governments add extra demand stimulus.

US, EU Reach WTO Tariff-quota Pact Post Brexit, USTR Says

The European Union and the US have reached an agreement after two years of talks on how to adjust so-called tariff-rate quotas that had to be renegotiated after the UK left the bloc. The negotiations took place under World Trade Organization procedures and will determine how to split TRQ quantities between the 27-nation region and the UK, the office of the U.S. Trade Representative said.

ECB Increases Bond Buying After Warnings About Higher Yields

The European Central Bank stepped up the pace of its emergency bond-buying last week after policy makers issued repeated warnings that a recent rise in yields threatens to derail the region’s economic recovery. Gross purchases settled under its pandemic emergency program totaled 18.2 billion euros (US$21.6 billion) in the week ended March 5, compared with 16.9 billion euros a week a earlier.

UK Shop Sales Accelerate as End of Lockdown Nears, BRC Says

UK retail sales growth accelerated in February as the government’s roadmap to end the coronavirus lockdown spurred purchases of back-to-school items, an industry survey showed. The increase of 1% last month compared with a gain of 0.1% a year ago and average growth of 0.6% for the past three months, according to the report by the British Retail Consortium.

RBA’s Lowe Pushes Back Against Market, Rates Firm Until 2024

Reserve Bank of Australia chief Philip Lowe pushed back against bond markets pricing in an earlier tightening of monetary policy, reiterating that interest rates are unlikely to rise until at least 2024 as inflation is a long way from target. Lowe emphasized the evolution of the RBA’s inflation-targeting regime that now requires actual -- not forecast -- inflation to be within the 2-3% target band before considering moving rates.

Japan’s Economy Took Double-digit Growth Momentum Into Emergency

Japan confirmed its economy grew by double-digits at the end of last year, according to revised data that continued to show strength even as this quarter’s virus emergency sets back the recovery for the time being. Gross domestic product grew an annualized 11.7% from the prior quarter in the three months through December, the Cabinet Office reported.

Oil Deepens Retreat After Recent Rally Flashes Technical Warning

Oil pulled back from recent multi-year highs after technical indicators showed crude rallied too far too fast. Brent crude for May settlement declined US$0.72 to US$67.52 per barrel.

Source: Affin Hwang Research - 12 Mar 2021