• European bourses are firmer across the board as risk-sentiment recovers, Euro Stoxx 50 +5.0%; albeit, Energy/Basic Resources names are lagging amid an unwinding in geopolitical-premia, evidenced notably in crude.
• US futures are firmer across the board, though the magnitude of action is less pronounced when compared to European peers, ES +1.7%.
• Russia says "some progress" has been made in discussions with Ukraine; subsequently, Ukraine's Foreign Minister Kuleba says he has limited expectations from discussions with Russian Foreign Minister Lavrov.
• Dollar, Yen and Gold out of favour with the DXY hovering around 98.5000, USD/JPY eyeing 116 and spot bullion hovering just above Usd 2k/oz.
• Core debt has also pulled-back, taking out multiple touted support levels with attention turning to yields as the Bund yield approaches 20bp once more.
• Looking ahead highlights include US JOLTS, South Korean Presidential Election Results and US 10yr Supply.

As of 11:20GMT/06:20EST

LOOKING AHEAD

• US JOLTS, South Korean Presidential Election Results and US 10yr Supply.
• Click here for the Week Ahead preview.

GEOPOLITICS

RUSSIA-UKRAINE

DISCUSSIONS/NEGOTIATIONS

• Russian Foreign Minister Lavrov will travel to Turkey today to meet with the Ukrainian Foreign Minister, according to Ria citing the Russian Foreign Ministry.
• Russian Foreign Ministry says aims of its operation do not include the overthrowing of the Ukraine government.
• Russia says "some progress" has been made in discussions with Ukraine, according to AFP.
• Russia's Kremlin says Russia has made no decision on nationalising foreign assets; interested in continuing talks with Ukraine. On possible compromise with Ukraine: Crimea is Russian region, must be recognised as such and Donetsk/Luhansk are sovereign republics, must be recognised as such.
• Ukraine Foreign Minister Kuleba says he has limited expectations from discussions with Russian Foreign Minister Lavrov.

ENERGY/ECONOMIC UPDATES

• US House is planning to vote on the Russian oil ban today, according to Bloomberg's Wasson.
• US State Department Envoy Hochstein said about 3mln bbls of oil is now stranded because there is such outrage in Europe regarding what is happening in Ukraine, while Hochstein added the US is in a dramatically different place than Europe as it imports less oil from Russia.
• Saudi and Emirati leaders declined calls with US President Biden during the Ukraine crisis, according to WSJ.
• British Energy Minister Hands said Russian sanctions are beginning to bite and that they are ready to work internationally on reducing dependence on Russian gas, while he added the country is in a good position on natgas supply but vulnerable on the price side.
• EU Commission President von der Leyen says they have purchases so much LNG that it will be independent of Russian gas until end-winter.
• Dutch PM Rutte, when asked about a potential joint EU fund to respond to the war, says the existing instruments should be used to the max first.
• Russian Foreign Ministry says their reaction to Western sanctions will be sensitive and precise, working on measures in all directions, via Reuters citing Ria.
• Ukraine state power grid operator says Russian forces have disconnected Chernobyl nuclear power plants from grid; Ukrainian Energy Minister says we do not know what is happening at Chernobyl nuclear plant, via Reuters.
• CBR said clients with foreign currency accounts can withdraw a maximum of USD 10k and withdrawals above this must be taken in RUB with the rule will stay in place until September 9th.
• Fitch downgraded Russia from B to C due to its view that a sovereign default is imminent.
• MSCI announced to discontinue MSCI Russia IMI Select GDR Index.

3RD PARTY REMARKS

• US President Biden tweeted that "This much is already clear: Ukraine will never be a victory for Putin. Putin may be able to take a city — but he will never be able to hold the country".
• UK Transport Secretary Shapps tweeted they have made it a 'criminal offence' for any Russian aircraft to enter UK airspace.
• A source close to the Iranian negotiating team in Vienna told Iran’s state media on Wednesday that a “good” deal was on the table, but that the delay in the political decision making in Washington is hindering the process, according to Rudaw News.

OTHER

• Iranian Chief Nuclear Negotiator/Deputy Foreign Minister Kani has arrived in Vienna, according to journalist Aslani.

EUROPEAN TRADE

EQUITIES

• European bourses are firmer across the board as risk-sentiment recovers, Euro Stoxx 50 +5.0%; albeit, Energy/Basic Resources names are lagging amid an unwinding in geopolitical-premia.
• US futures are firmer across the board, though the magnitude of action is less pronounced when compared to European peers, ES +1.7%.

Click here for more detail.

FX

• Safe havens shunned as sentiment flips firmly to risk back on mode.
• Dollar, Yen and Gold out of favour with the DXY hovering around 98.5000, USD/JPY eyeing 116 and spot bullion hovering just above Usd 2k/oz.
• Aussie outperforms after RBA Governor Lowe says tightening in 2022 might be plausible; AUD/USD regains 0.7300+ status and AUD/NZD probes 1.0700 even though the Kiwi is bouncing vs its US rival to test 0.6850.
• Euro claws back more of its hefty declines, but Rouble remains pressured ahead of talks between Russian and Ukrainian Foreign Ministers in Turkey tomorrow
• EUR/USD fades just shy of 1.1100 vs recent low close to 1.0800, USD/RUB still near record highs in contrast.

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FIXED INCOME

• Bonds continue their losing streak as yields reach or approach psychological levels amidst a marked improvement in risk sentiment.
• US Treasuries also face 10 year issuance, but the deeper concession may help after a weak 3-year note sale.
• BTPs hold up better than Eurozone peers on the eve of the ECB, perhaps hoping for some support.

Click here for more detail.

COMMODITIES

• WTI and Brent continue to pullback as geopolitical-premia lessens as updates are, seemingly, more constructive; currently, WTI Apr and Brent Mar are around USD 121.50/bbl and USD 125.50/bbl respectively vs highs of USD 126.84 and USD 131.64 respectively.
• US Private Energy Inventory Data (bbls): Crude +2.8mln (exp. -0.7mln), Cushing -0.4mln, Gasoline -2.0mln (exp. -2.1mln), Distillate -5.5mln (exp. -1.9mln)
• US Crude Output to gain 850k BPD to 12.03mln BPD in 2022 (prev. saw a rise of 770k BPD M/M) and is to rise 960k BPD to 12.99mln BPD in 2023 (prev. saw a 630k BPD rise M/M), according to EIA.
• OPEC Secretary-General Barkindo said there is no physical shortage of oil. Barkindo also said they are in unchartered territory and that uncertainties keep mounting, according to Energy Intel.
• Nigerian Minister of State for Petroleum and Resources expects the country to raise output to meet OPEC quota by year-end.
• Libya's NOC Chairman Sanalla said state production is currently 1.3mln bpd which will reach 1.5mln bpd by year-end and 2.1mln bpd in 2-3 years.
• Beijing tells China state refiners to pause diesel and gasoline exports in April, according to Reuters sources.
• Venezuela released two American prisoners following discussions with the US and the US is said to pin any easing of Venezuela oil sanctions on direct oil supply to the US, according to Reuters sources.
• Greek PM Mitsotakis is calling for “targeted and temporary market intervention” within the electricity and gas markets, such intervention is justified by the high level of price volatility; calling for a price and profit cap, alongside an emergency price setting. (Politico) Measures are to be discussed by EU leaders on Thursday
• Shanghai Futures Exchange suspends some nickel futures contract trading for one day.
• Spot Gold/Silver are pressured, moving in-line with action in safe havens; a move that has seen spot gold, for instance, approach a re-test of the USD 2000/oz mark to the downside.

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CRYPTO

• US Treasury will create a report on the future of money and payments and evaluate crypto security risks. Subsequently, US President Biden is to sign an executive order on assessing pros and cons of digital assets; core policy objective remains to maintain centrality of USD in global markets.

Click here for the US Early Morning Note

APAC TRADE

EQUITIES

• APAC stocks were mostly mixed with the region finding some respite from recent selling despite the weak lead from the US, where the major indices were choppy after the US and UK moved to ban imports of Russian oil.
• ASX 200 gained with the gains across sectors led by tech, consumer discretionary and financials.
• Nikkei 225 briefly reclaimed 25k, but with initial upside reversed after downward revisions to the final Q4 GDP data.
• Hang Seng and Shanghai Comp. bucked the trend with Chinese sports brands underperforming in Hong Kong as Norway's sovereign wealth fund is to offload its stake in Li Ning over suspicions of forced labour, while Goldman Sachs sees China on course to miss its growth target this year by 1ppt due to the oil shock and COVID.

NOTABLE APAC HEADLINES

• PBoC injected CNY 10bln via 7-day reverse repos with the rate at 2.10% for a net neutral daily position.
• PBoC set USD/CNY mid-point at 6.3178 vs exp. 6.3094 (prev. 6.3185).
• Hong Kong Chief Executive Carrie Lam said they are still working on mass testing details and mass testing would still be useful, but the timing needs to be considered, and it is not a main priority for coronavirus.
• South Korean Exit Polls. Network TV: Conservative Suk-Yeol 48.4% vs Liberal Jae-Mying 47.8%. JTBC: Conservative Suk-Yeol 47.7% vs Liberal Jae-Mying 48.4%.

DATA RECAP

• Chinese CPI YY (Feb) 0.9% vs. Exp. 0.9% (Prev. 0.9%); PPI YY (Feb) 8.8% vs. Exp. 8.7% (Prev. 9.1%)
• Japanese GDP QQ (QF) 1.1% vs. Exp. 1.4% (Prev. 1.3%); Annualised (Q4) 4.6% vs. Exp. 5.6% (Prev. 5.4%)