• Next round of Russia-Ukraine discussions could start at 12:00GMT today; though, Russia notes that they are awaiting the arrival of the Ukrainian delegation
• European bourses are lower and in-line with the generally cautious mood ahead of negotiations; US futures lower, ES -0.1%, but more contained pre-data & Fed speak
• DXY remains firm and either side of 97.50, with peers generally lower and havens not benefitting from the cautious tone in-fitting with the core debt pullback
• WTI & Brent are off best levels, at USD 116.50/bbl and USD 119.84/bbl for WTI April and Brent May respectively, but remain at elevated levels ahead of negotiations
• On Iranian nuclear negotiations, diplomats were said to genuinely not know which way it was going, most still think this could  come together but confidence levels are low
• US Composite/Services PMI (Final), US ISM Services PMI, Factory Orders, Japanese Unemployment, Speeches from Fed's Powell & Williams, ECB Minutes

As of 11:25GMT/06:25EST

LOOKING AHEAD

• US Composite/Services PMI (Final), US ISM Services PMI, Factory Orders, Japanese Unemployment, Speeches from Fed's Powell & Williams, ECB Minutes.
• Click here for the Week Ahead preview.

GEOPOLITICS

RUSSIA-UKRAINE

• Next round of Russia-Ukraine discussions could start at 12:00GMT today, according to Belta, citing a Russian Negotiator; with Foreign Minister Lavrov suggesting discussions are to start shortly while the Kremlin remarked that Ukraine is clearly not in a hurry for talks and President Putin's aide Medinsky says they are still awaiting the arrival of the Ukrainian delegation.
• Most recently, Russian negotiating delegation says "We are waiting for the arrival of the Ukrainian delegation", according to Sky News Arabia.
• Russian Deputy Foreign Minister believes that talks with Ukraine in Belarus can yield results, via Sky News Arabia.
• Russian Foreign Minister Lavrov says that President Putin and French President Macron are holding phone discussions at the moment. Reported at 10:00GMT/05:00EST
• US President Biden said Russia is responsible for the humanitarian crisis in Ukraine and for devastating human rights abuses.
• US State Department said Russia is engaged in a full assault on the truth regarding the war in Ukraine and that Russia is throttling Twitter, Facebook and Instagram platforms which Russians rely on for independent information.
• Canada imposed sanctions on a total of 10 individuals from Russian energy firms Rosneft and Gazprom.
• FTSE Russell said Russia will be deleted from all FTSE Russell equity indices effective from the open on March 7th, while Japan's GPIF is looking into announcements by index companies on Russia as portfolios will need to reflect index changes they track.
• Fitch downgraded Russia's sovereign rating from BBB to B; Rating Watch Negative and Moody's also cut Russia's sovereign rating from Baa3 to B3; Outlook Negative which put its at junk status.
• Germany to deliver 2.7k additional anti-air missiles to Ukraine, via AFP citing gov't sources.
• Ukraine's Secretary of the National Security and Defense Council Danilov says that their intelligence is that Russia is set to impose martial law across Russia from March 4th, according to Ukrinform citing the Ukrainian official. Note, this is a report in Ukrainian press and we are yet to see reports on the subject from Russian vendors, as such, proceed with caution. Russian Kremlin subsequently pushed back on such reports.
• Ukraine has requested that the IAEA asks NATO to close the air above Ukrainian power plants to avoid acts of "nuclear terrorism".
• US President Biden is to hold a call with the Quad leaders Thursday morning re. Ukraine, at 14:00GMT/09:00EST.

OTHER

• IAEA chief Grossi will visit Iran on Saturday, according to Nournews. In relevant news, diplomats were said to genuinely not know which way it was going on the Iran nuclear deal and most still think this could come together but confidence levels are low, according to WSJ's Norman.
• Armed force affiliated with Libya's Tripoli gov't has reportedly seized two rival government ministers which are to be sworn into office on Thursday, via Reuters citing sources

EUROPEAN TRADE

EQUITIES

• European bourses, Euro Stoxx 50 -0.5%, are moving in-line with the generally cautious mood as we await the commencement of the Russia-Ukrainian negotiations, which are set for around 12:00GMT/07:00EST; though, we are yet to see the Ukrainian delegation arrive.
• Within sectors, the picture is mixed after initial relative underperformance in cyclical names.
• US futures are modestly softer, ES -0.2%, but have been fairly contained amid the geopolitical developments awaiting US data and Chair Powell's second day of testimony.

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FX

• High stakes and anxiety levels in the FX space as Russia and Ukraine head for ceasefire fire talks from around 12:00GMT/07:00EST.
• DXY firm either side of 97.500 as yields rise again and risk aversion resurfaces.
• Aussie underpinned near 0.7300 and the 200 DMA as industrial metals remain strong.
• Franc rebounds following above forecast Swiss CPI in stark contrast to Lira after latest acceleration in headline and pipeline Turkish inflation; USD/CHF sub-0.9200, EUR/CHF circa 1.0200 and Usd/Try above 14.000.
• Euro still lagging on conflict contagion and Rouble back down towards all time lows; EUR/USD under 1.1100 and Usd/Rub eyeing 119.00.

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FIXED INCOME

• Bonds continue to unravel remnants of residual safety premium.
• US Treasuries tread water and the curve flat-lines ahead of packed pm agenda, including data and Fed chair Powell at the Senate.
• Bonos and OATs also digest supply from Spain and France.

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COMMODITIES

• WTI & Brent are off best levels, at USD 116.50/bbl and USD 119.84/bbl for WTI April and Brent May respectively, but remain at elevated levels ahead of negotiations.
• Japan plans to hold a ministerial meeting on Friday to compile measures to respond to higher oil prices.
• Gazprom is shipping gas to Europe via Ukraine, in-line with requests; separately, the Yamal-Europe pipeline westbound gas flows to Germany from Poland have stopped, via Reuters citing Gascade data.
• Iran's Energy Minister Owji says domestic oil production can hit maximum capacity in one/two months following a nuclear agreement being reached, via Reuters citing a Telegram channel.
• Spot gold/silver are supported but around familiar parameters while base metals experienced noted overnight upside, particularly nickel and zinc.

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CRYPTO

• Bitcoin has been erring lower throughout the session after an initial move higher fizzled out, though, Bitcoin remains towards the top-end of recent levels capped by the USD 45k mark.

DATA RECAP

• EU Markit Composite Final PMI (Feb) 55.5 vs. Exp. 55.8 (Prev. 55.8); Services Final PMI (Feb) 55.5 vs. Exp. 55.8 (Prev. 55.8)
• EU Unemployment Rate (Jan) 6.8% vs. Exp. 6.9% (Prev. 7.0%)
• UK Markit/CIPS Services PMI Final (Feb) 60.5 vs. Exp. 60.8 (Prev. 60.8); Composite PMI Final (Feb) 59.9 vs. Exp. 60.2 (Prev. 60.2)

NOTABLE US HEADLINES

• Tesla (TSLA) has secured approval for its planned Berlin, Germany "gigafactory" factory, via Handelsblatt; officials are looking to comment on the approval at a Friday presser; other requirements need to be met before production starts.
• Some investment firms are considering asking the SEC for relief from a cap on the percentage of illiquid assets that funds can hold given the impact of Ukraine/Russia conflict on EM securities, according to WSJ sources.

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APAC TRADE

EQUITIES

• APAC stocks traded mostly positive after the gains in the US where stocks and yields climbed amid peace talk hopes and hawkish central bank rhetoric, but with upside capped as the region digested a slowdown in Chinese Caixin Services PMI data.
• ASX 200 was underpinned by a commodity surge, spearheaded by the energy sector as Brent rose to its highest level since 2013.
• Nikkei 225 benefitted from a weak JPY but with gains capped as Tokyo and neighbours seek an extension of COVID measures.
• Hang Seng and Shanghai Comp. were mixed with the mainland clouded after PBoC's liquidity drain and soft PMI data.

NOTABLE APAC HEADLINES

• PBoC injected CNY 10bln via 7-day reverse repos with the rate at 2.10% for a CNY 190bln drain.
• PBoC set USD/CNY mid-point at 6.3016 vs exp. 6.3012 (prev. 6.3351).
• South Korean Presidential candidate Ahn confirms support for candidate Yoon Suk-yeol ahead of March 9th elections.
• Japanese PM Kishida will tap over JPY 360bln from emergency reserves to help cushion the blow on people's lives and businesses amid increasing energy costs.

DATA RECAP

• Chinese Caixin Services PMI (Feb) 50.2 (Prev. 51.4); Composite PMI (Feb) 50.1 (Prev. 50.1)
• South Korean GDP QQ (Q4 F) 1.2% (Prev. 1.1%); YY (Q4 F) 4.2% (Prev. 4.1%)
• Australian Building Approvals (Jan) -27.9% vs. Exp. -3.5% (Prev. 8.2%, Rev. 9.8%)
• Australian Trade Balance (AUD) (Jan) 12.9B vs. Exp. 9.1B (Prev. 8.4B)
• Australian Exports MM (Jan) 8% (Prev. 1%); Imports MM (Jan) -2% (Prev. 5%)

CENTRAL BANKS

• BoE's Cunliffe said the heightened perception of geopolitical risks and the potential impacts on growth and inflation can only increase risks around adjustment away from riskier assets, while he added sanctions will do severe damage to the Russian economy but should not have material risks to financial stability more broadly.