Ipek Ozkardeskaya
Swissquote Bank Ltd
The selloff in US treasuries continued yesterday over concerns that Donald Trump’s presidency would boost spending and inflation in the US, and make the Federal Reserve’s (Fed) job of bringing inflation back to the 2% target more difficult. The selloff slowed after weaker-than-expected ADP report.
Across the Atlantic, The 10-year gilt yield advanced to the highest level since 2008 yesterday and broke above the peak levels that were reached during Liz Truss’ historic mini budget crisis. Sterling fell against a broadly bought US dollar, but also against the weakening euro.
The barrel of US crude remembered what it was like to sit above the $75pb level for a while, before returning to the $73-ish levels. And finally, trade tensions get tenser between the US and the latter. Biden announced additional restrictions on AI chip exports – after blacklisting Tencent and CATL, one of Tesla’s key battery suppliers. Nvidia dipped below $140 share after the bell, while quantum stocks tanked after Jensen Huang said that he doesn’t see quantum computers’ usefulness before 15 – or even 20 years.
Note that the US stock markets will be closed today as day of mourning for Jimmy Carter, while the bond market will close at 2pm New York time.
This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.
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