Financial Markets Daily Report01 February 2022
Financial markets started the week with a risk-on session, as investors shifted their focus to corporate earnings and economic indicators, taking a breath from the prospect of monetary policy tightening by the major central banks.
- Financial markets started the week with a risk-on session, as investors shifted their focus to corporate earnings and economic indicators, taking a breath from the prospect of monetary policy tightening by the major central banks.
- On the data front, eurozone GDP rose by 0.3% q/q in Q4, much lower than the 2.3% rebound in Q3 but just enough for the size of the economy to return to its pre-crisis level. In addition, the flash HICP data for January in Germany (5.1% after 5.7%) and Spain (6.1% after 6.6%) surprised to the upside.
- In this context, sovereign bond yields rose in both sides of the Atlantic, with the German 10-year Bund closing in positive territory. Spreads across the eurozone periphery, however, tightened following recent elections in both Italy and Portugal. Commodity prices continued to rise, with the Brent price closing above 90 US$/barrel.
- Today the key data releases are the final manufacturing PMIs and the ISM manufacturing for the US.