STATE OF THE MARKETS

Stocks dumped amid safe haven flows. US stocks were dumped in afternoon trading after Fed’s Powell confirmed his stance on speedy asset tapering and potentially earlier hikes. News of first case of Omicron detected in California exacerbate the fall further as Dow (-1.34%), Nasdaq (-1.83%) and S&P (-1.18%) reeled lower while more than $340 billion worth of block orders hit the US bond futures of various maturities. The 10Y benchmark dived further to 1.42% as the Dollar index clung to the 96 handle.

In the commodities market, crude was under pressure but remained supported at the $65/bl as markets continue to weigh the impact of Omicron. Dollar strength on earlier rate hike expectation, continued to press gold lower but the precious metal managed to close above $1,780/oz on strong bids. Elsewhere iron ore rebounded to the $95/tn handle as investors continue to hope on strong demand from US infrastructure projects.

In the FX space, long and medium term investors remain bearish as Yen, Swiss, Dollar and Euro continue to dominate demand. Short term traders reverted to bearish as Dollar and Yen seized the leads in demand from Euro and Kiwi. On Thursday, markets look for earnings reports from TD Bank (TD), Marvel Technology (MRVL), Dollar General (DG), CIBC (CM), Kroger (KR) and DocuSign (DOCU) as well as the latest US jobless claims.