Strongest week on U.S. market since july 2022

Last week closed in positive territory while investors focused on October inflation data in the US. On Wall Street, the highest demand remains on the high-tech sector, for which the expected reduction in the Fed’s rate hike is the most favorable. Some positive news in China on expectations of easing anti-COVID restrictions. But the global cryptocurrencies continue to be in a fever – bitcoin is already quoted below $16K, investors are extremely nervous about the situation with the FTX crypto exchange, which is facing bankruptcy, and this can become a kind of Lehman Brothers for this industry. During Friday’s trading session, the Dow Jones added 32.5 points or 0.1% to 33,747.9, the S&P 500 gained 36.5 points or 0.9% to 3,992.9, and the NASDAQ Composite rose 209.2 points or 1.9% to 11,323.3. For the week, the Dow rallied 4.2%, the S&P 500 added 5.9%, and the NASDAQ popped 8.1%. On the bond markets, UST 10-Year rates were at 3.811%.

Ukrainian forces swept into the southern city of Kherson over the weekend and are now set to restore the essential services including electricity, heat, water and telecommunications. The region around the city was one of four that were absorbed into Russia’s territory in September and Russia’s withdrawal represents a significant setback for Russia’s President Putin. Russia’s equity market rose to the highest level in eight weeks this Monday morning led by metals producer Norilsk Nickel and energy giant Gazprom. IMOEX was up 0.78% to 2,239 and RTSI was up 1.01% to 1,170. Online retails platform Ozon Holding jumped as much as 4.3%. Rosneft slid 1.7% after the oil producer and refiner proposed a 9-month dividend of RUB 20.39 per share. Russian rouble lost this morning both against US Dollar and Euro with USDRUB up 0.17% to 60.33 and EURRUB up 0.73% to 62.21. Russian bond yields were lower with 10-year benchmark rouble bonds losing 4bps to 9.97%. In other news, Russian oil production is now expected to see only a “modest drop” after a recent statement from the US Treasury Secretary on how proposed oil price cap will be implemented. US is “happy” for India to continue buying as much Russian oil as it wanted, as long as it doesn’t use western insurance, finance or tankers. Russia’s current account reached a surplus of $215 Bn for the first ten months of the year, bloated on energy exports amid the continuous sanction-induced contraction in imports.

EU stocks opens higher on Monday with the focus on recovery of regional economics.

the DAX futures contract in Germany traded 0.17% higher at 14,280 level, the FTSE 100 futures contract in the U.K. rose 0.29% to 7,355 points, while CAC 40 futures in France added 0.36% to 6,617.

The main European indices followed their U.S. peers sharply higher last week, with the benchmark S&P 500 index posting its biggest weekly gain in almost five months, after U.S. consumer prices rose less than expected in October, lifting hopes that the Fed will slow its aggressive monetary tightening campaign.

SSA opens muted as rates go higher while the dollar stages a mini rebound from Friday’s low. The space continued firmer on Friday even as liquidity was thinner given the US holiday. IVYCST (+2.875) the outperformer with € duration particularly bid. NGERIA (+2.25) also closed at session highs despite the Fitch downgrade to B- citing a deterioration in debt servicing costs and external liquidity; bonds open firmer still.

The bonds market closed on a relatively negative note. Average yields on the short & medium tier of the curve closed higher by 1bps while the long end also rose by 3bps. There was demand for the Jan 2026s as it was the best performer. The NTB secondary market closed on a flat note with average yields remained unchanged across the short to medium tier of the curve. However, yields dropped marginally by 1bps on the long end of the curve as there was some buying interest. In the OMO secondary market, yields also remained unchanged across the curve.