U.S. stocks ended mostly lower yesterday, with the S&P 500 and Dow Jones each falling a fifth straight day, ahead of what’s expected to be one of the biggest Fed interest rate hikes in decades to be announced today. Inflation has boosted expectations of a more aggressive Fed, while fostering recession concerns. Subsequently S&P 500 fell 0.4% to finish at 3,735.48, Dow Jones fell 0.5% to close at 30,364.83, while Nasdaq 100 rose 0.2% to finish at 10,828.35. Gold price is also down $17.10 to $1,814.70 per ounce while WTI crude oil increased $2.46 to $123.39 per barrel.

Russia has pushed to capture the Ukrainian government’s last major foothold in the eastern region of Luhansk and as noted by the regional governor, now controls 80% of the Sievierodonetsk. While Ukraine’s president, Volodymyr Zelenskiy has reiterated, that fighting will only end when all invading troops leave the country, US Secretary of State Antony Blinken said it’s up to Zelenskiy’s government to make any decisions about territorial concessions, adding that the US and its allies are working to provide the help Ukraine needs in the battlefield. Russian equity market has fluctuated between minor gains and losses this morning, as investors were waiting for the outcome of the US Federal Reserve meeting. IMOEX was up 0.2% at 2,295 with Aluminum producer Rusal gaining 1.2% and Polyus, the gold producer, falling 1.4%. After Sberbank’s official announced that the bank will complete the sale of its Swiss and Kazakh units by mid-July, Sberbank shares have gained 0.1%. Despite of the sanctions, Russian companies and the state have so far managed to pay investors about $6.4 billion in coupons and maturities since early March. However, locals relying on relying on their NSD account, which was blacklisted by the EU at the start of June, to access those payments have missed out. The conversion of depository receipts or Russian companies listed abroad to local shares has also stopped due to the block of NSD. Despite of this, Russian sovereign bonds remained unchanged with Russia 28 offered in mid 30s and Russia 47 in mid 20s. With a trade surplus growing and toxicity of hard currency at banks, Russian ruble continued strengthening to its highest levels since March 2018. This Wednesday morning USDRUB was down at 56.74 and EURRUB at 59.17.

SSA opens to a firm tone ahead of FOMC decision late in the session; reports that a 75bps hike may have suddenly come on the cards appear to have been taken in stride with 10Y USTs trading some 10bps  lower than Tuesday’s peak of 3.49%. GHANA (+0.875pts) outperformed in a broad rebound for the space with demand on short to belly tenors. NGERIA (+0.375pts) meanwhile, saw more demand on longer tenors while flows on shorter recent issues (28, 29, 33) were balanced. Both open on the same trend – demand skewed towards longer tenors for NGERIA and on shorter tenors for GHANA.