In the U.S markets the dominant theme which still lingers remains prospective Fed rate hikes and the possible reduction of its holdings in Treasuries starting later in 2022. The withdrawal of outsized stimulus threatens to inject more volatility across a range of assets which have seen global stocks drop more than 3% this year. Rising yields are weighing on yield-sensitive tech stocks and growth themed areas of the market as a rapid rise in interest rates makes their future cash flows less valuable, and in turn makes the popular stocks appear overvalued, and that is causing a broad recalibration of tech and tech-related shares that populate the Nasdaq, which even booked its first close in correction territory since March with a rapid surge in Treasury yields, and expectations for interest-rate increases from the Federal Reserve blamed for the weakness in the once-highflying benchmark. At closing, futures on the S&P 500 rose 0.2%, futures on the Nasdaq 100 rose 0.3% and the futures on the Dow Jones Industrial Average rose 0.2% while the yield on 10-year Treasuries declined two basis points to 1.85%. Focus today turns to the market on Thursday include U.S. jobless claims data, which last week showed the first real impacts from the wave of Omicron-variant Covid-19 across the country. The Philadelphia Federal Reserve will also release its monthly business survey, while existing home sales data for December are also due.
European stocks erased initial gains as the global sovereign-bond selloff paused and investors turned their focus to corporate earnings. Europe’s Stoxx 600 Index was slightly lower, while all three major U.S. benchmarks were poised to advance. Miners outperformed, boosted by the rally in metals. German statistics office Destatis reported that producer prices rose 5.0% in the month of December alone, and were up 24.2% on the year, well above inflation. Most of that increase was because natural gas prices more than doubled. Eurozone consumer price data for December are due at 5 AM ET. The ECB also releases the accounts of its last meeting later Thursday.
Kenya has hired the likes of JPMorgan, Citigroup as lead arrangers for planned Eurobond bond sale, Business Daily reports, citing National Treasury officials. The timing of the issuance will depend solely on market conditions. It is worth nothing that Kenya’s National Treasury said in December government plans Eurobond sale by end of June. The Treasury is hoping to speed up the Eurobond program to get a favourable appetite, especially before the next General Election, which carries political risks that might affect its attractiveness. Details of the bond issue on tenure pricing and timing will be guided by the arrangers,” officials said while the size of the issue has been agreed with the International Monetary Fund (IMF) as the timing will depend on market conditions as earlier stated.