• Ukraine and Russia reached an understanding on a joint provision of humanitarian corridors for evacuating civilians.
• Ukraine's Zaporizhzhia nuclear power plant was attacked by Russia; safety of the plant has since been secured. 
• APAC stocks were seen lower amid fears surrounding the Russian attack on the Ukrainian power plant. 
• European equity futures are indicative of a negative open with the Euro Stoxx 50 future down 2.1% after the cash market closed down by 2.1% yesterday.
• In FX, the DXY remains on a firm footing after temporarily breaching 98.00 to the upside.
• Looking ahead, highlights include German Trade Balance, EZ Retail Sales & Construction PMI, US Labour Market Report.
• NOTE: During the initial publication of this document, it was reported that the Zaporizhzhia nuclear power plant has been seized by Russian military forces, according to the regional authority

US TRADE

• US stocks finished lower with most of the weakness stemming from the open and underperformance in tech.
• S&P 500 -0.5% at 4,363, Nasdaq 100 -1.5% at 14,035, Dow Jones -0.3% at 33,794, Russell 2000 -1.5% at 2,032.

GEOPOLITICS

RUSSIA-UKRAINE

• A fire was reported at Ukraine's Zaporizhzhia nuclear power plant which is the largest in Europe amid an attack by Russian troops. Ukraine's Foreign Minister Kuleba also confirmed the nuclear power plant caught fire and said the Russian army is firing from all sides upon the nuclear plant, while he warned that if it blows up, it will be 10 times larger than Chernobyl.
• Ukraine's state emergency service later stated that the fire outside the Ukrainian nuclear power plant broke out outside the perimeter and at a training building, while it was also announced that safety of the nuclear power plant was now secured and that plant fire didn't affect essential equipment.
• US Energy Secretary Granholm said the department activated its nuclear incidence team and is monitoring events at the Ukraine nuclear plant. Granholm added the plant's reactors are being protected by robust containment structures and they saw no elevated radiation readings near the facility.
• UK PM Johnson spoke to Ukrainian President Zelensky about the situation at the power plant and said that Russia must immediately cease its attack on the plant, while he added that reckless actions of Russian President Putin could directly threaten the safety of all Europe.
• Russia and Ukraine agreed to hold a third round of talks soon and they did not receive results they had counted on, according to Ukrainian negotiator. The two sides reached an understanding on a joint provision of humanitarian corridors for evacuating civilians and an agreement involved a possible temporary ceasefire during evacuations.
• Russian negotiator said they discussed military and humanitarian issues at talks with Ukraine and future political regulation of the conflict, while they also agreed on a possible ceasefire around those corridors. The negotiator thinks this is substantial progress and confirmed a third round of talks in the coming days.
• Third round of talks between Ukraine and Russia will take place at the beginning of next week, according to Belarus agency Belta citing Ukraine negotiator.
• Russian President Putin said they will destroy this 'anti-Russia' created by the west and Russia's special military operation is going according to plan.
• US imposed sanctions on Russian energy giant Transneft’s CEO and in total imposed visa restrictions on 19 Russian oligarchs and 47 of their family members and associates. US also issued full blocking sanctions on disinformation targets including seven Russian entities and 26 individuals in those groups.
• US official said the Department of Defense has created a deconfliction line with Russia to prevent miscalculation, military incidents and escalation.
• White House Press Secretary Psaki said limiting Russian oil imports would raise gas prices and there is no interest in cutting oil supplies, while she added that President Biden is to specify more Russia sanctions shortly.
• US Senator Graham called for Russian President Putin's assassination, according to BNO News.
• S&P lowered Russia's sovereign rating to 'CCC-' and kept on CreditWatch negative on increasing risk of default.

OTHER

• Iran said "extra work" is needed to revive the 2015 nuclear deal and that "nobody can say the deal is done, until all the outstanding remaining issues are resolved".
• Russia's envoy to Iran talks said they are close to the finish line and does not think talks will collapse, while outstanding issues are relatively small, but not yet settled.
• US State Department said there has been significant progress in nuclear talks with Iran and that they are close to a possible deal but a number of difficult issues still remain unresolved
• EU's Mora said the Iran nuclear deal is still not there yet but they are in the final stages.

APAC TRADE

EQUITIES

• APAC stocks declined amid nuclear catastrophe fears after a fire broke out at the Zaporizhzhia nuclear power plant in Ukraine which is the largest in Europe and was hit by Russian shelling.
• ASX 200 was dragged lower by cyclicals but moved off worse levels on relief as the safety of the nuclear power plant in Ukraine was eventually reported to be secured.
• Nikkei 225 fell beneath 26,000 on geopolitical concerns and the extension of quasi-emergency measures.
• Hang Seng and Shanghai Comp. weakened with losses in Hong Kong exacerbated by a tech rout but the mainland was somewhat cushioned as Chinese press speculated potential lowering of MLF rates this month.
• US equity futures declined on initial reports of the nuclear power station attack which dragged the Emini S&P briefly beneath the 4,300 level, although bounced off their lows as the later headlines soothed concerns.
• European equity futures are indicative of a negative open with the Euro Stoxx 50 future down 2.1% after the cash market closed down by 2.1% yesterday.

FX

• DXY strengthened as risk appetite took a hit from the Russian shelling of Europe’s largest nuclear power plant in Ukraine which Ukraine's Foreign Minister Kuleba warned would be 10 times larger than Chernobyl if it blew up.
• EUR/USD declined amid the risk aversion with the single currency trading sub-1.1050.
• GBP/USD lacked direction whilst a report suggested UK PM Johnson is unlikley to trigger Article 16 ahead of the Northern Ireland elections in May citing the war in Ukraine.
• USD/JPY was subdued and JPY-crosses briefly wobbled amid the geopolitical concerns.
• Antipodeans were initially pressured but later found relief and outperformed the major pairs.
• CAD BoC Governor Macklem said at the next meeting in April, they will certainly have a discussion about ending reinvestment phase and starting quantitative tightening.

FIXED INCOME

• 10yr USTs was initially lifted by over a point to above 128.00 after the Russian shelling of the Zaporizhzhia nuclear power plant resulted in a fire, although some of the gains were retraced as the fire was later reported to be outside the perimeter and radiation safety was secured.
• Bunds briefly climbed above 170.00 before pulling back as risk assets found some relief.
• 10yr JGBs oscillated through the 151.00 level but with gains kept moderate by the lack of BoJ purchases.

COMMODITIES

• WTI and Brent retraced some of yesterday's pullback amid geopolitical concerns.
• Japan will release 7.5mln bbls of oil from private reserves in coordination with the IEA to cool rising prices.
• EU targets to double the quantity of gas storage available by next winter and is to set a target for 80% increase (vs. prev. 29%), according to the FT.
• Spot gold heads into NFP little changed with prices flickering on the nuclear power plant attack.
• Copper was unfazed by the latest geopolitical events and extended on gains with Goldman Sachs forecasting prices to reach a record USD 12k/ton.

CRYPTO

• Bitcoin was pressured overnight and fell beneath the USD 42,000 level.

NOTABLE APAC HEADLINES

• PBoC injected CNY 10bln via 7-day reverse repos with the rate at 2.10% for a CNY 290bln drain.
• PBoC set USD/CNY mid-point at 6.3288 vs exp. 6.3143 (prev. 6.3016)
• US Deputy Treasury Secretary said China will need to responsibly follow export controls on Russia and Russia cannot supply China with most complex semiconductors.

EUROPE

NOTABLE EUROPEAN HEADLINES

• UK PM Johnson reportedly moves away from suspending the Northern Ireland trade deal with the PM unlikely to invoke Article 16 ahead of the May Stormont elections amid the war in Ukraine, according to FT

US

NOTABLE US HEADLINES

• Fed's Williams (voter) said the Fed is focused on management amid uncertainty and that the economy is strong but is facing upside risk to inflation. Williams said the central bank has to be data-dependent and transparent about its thinking, while he added that inflation is much higher than the Fed expected and that the Fed doesn't know exactly what the Fed Funds Rate will be next year because it will depend on the economy.
• Fed's Barkin (2024 voter) is not confident yet that supply chains are improving and is not opposed to selling MBS but the decision would be a long way off.
• US President Biden administration is examining if a waiver on biofuel blending mandates could assist in stabilising food prices, according to Reuters sources.
• US Commerce Secretary Raimondo said they are looking carefully to see if tariff exclusions make sense as a way to ease inflation, according to CNBC.