Sentiments on the Wall Street improved quite sharply, and to somehow brighten up the not impressive dynamics of December, recent outsiders – Tesla and FAANG – were in the greatest demand. The high-tech Nasdaq added more than 2.5 percent, in today’s trading session in Asia, tech sector is also showed best performance. The Dow Jones Industrial Average gained 1.1% to 33,220.80 level, the S&P 500 rose 1.8% to 3,849.28 points while the Nasdaq Composite was 2.6% higher at 10,478.09 points.
As well as dip-buying momentum, tech was also supported by a fall in Treasury yields after data pointing to slowing labor market stoked hopes for a slowdown in wage growth and a less aggressive Federal Reserve.
US President Biden signed a $1.7 trillion government funding bill that includes $47 billion in additional aid for Ukraine. In the meantime, after the most intense missile barrages of the war, Ukraine’s President Zelenskiy said he expects Russia to launch further attacks before New Year’s Eve. Russian military fired 69 cruise missiles in the 10th large-scale missile attack against Ukraine on Thursday, that targeted the country’s power infrastructure in the cities across Ukraine, including capital Kyiv, as well as Kharkiv and Sumy in the north. Russian stocks were little changed this Friday, as oil and gas prices have stabilized. IMOEX was flat at 2,146 and RTSI gained 1.28% to 989. Steelmakers Severstal and Novolipetsk Steel were among the gainers, along with Rosneft Oil. The shares of Detskiy Mir, a children’s clothes retailer, slid. Moscow Exchange will be closed for a public holiday on Monday. Russian rouble gained this morning after two days of losses amid broader weakness of Dollar. USDRUB was down 0.98% to 71.20, while EURRUB was up 0.63% at 76.63. Russian bond yields were slightly up with a 10-year benchmark rouble bonds yields up 2 bps to 10.37%. The latest data suggests that inflationary risks still prevail and once they are realized, the central bank of Russia will be forced to raise the key rates next year, some analysts suggested. Forecasters believe the coming months will be more difficult for Russia as the war creates labor shortage and as new oil measures take hold. However, for now Russia’s economy experienced a more modest contraction, than anticipated, over the last 11 months, with economic output predicted to decline 2.7% by the end of the year.
Spanish CPI for December eased to 5.8%, a full percentage point from the November reading, continuing the reversal that’s followed the record 10.8% reading for July. The reading marks the only major data release today with the rest of the price figures for other eurozone states due in the new year. Stocks open lower with the Stoxx 600 down 0.38% while 10Y bund yields were up 5bps at 08:30 GMT.
SSA opens on the final trading session of 2022 with yet another attempt to reverse recent losses. Fitting open, emblematic of what the year has been for the SSA fixed income space – glimmers of hope for a recovery that ultimately get quashed! Bye 2022, we had our fair share of lessons. Little liquidity meant the space closed mostly unchanged on Thursday with the exception of NGERIA (+.125) which got a boost from some demand on belly tenors.
The NTB secondary market was quiet as average yields closed flat across the curve. The CBN conducted a primary auction offering a total of N67.43 billion across three maturities- 91, 182 & 364 days with stop rates closing at 2.749%, 7.15% & 8.49% respectively at an oversubscribed auction. In the OMO secondary market, average yields closed lower by 135bps across the curve with the medium end dropping by 380bps while the short end remained unchanged.
The FGN bonds secondary market closed on a mildly positive note with average yields across the curve, closing lower by 1bps. Average yields on the short end dropped by 8bps while the medium & long ends closed flat. The Mar 2025 bond was the best performer while the Apr 2037 bond was the worst performer.