• European bourses and US futures were choppy at the commencement of the European session, but, have since derived impetus in relatively quiet newsflow amid multiple earnings and as yields continue to ease; ES Unch.
• NFLX lower by 26% in the pre-market as subscriber numbers fall; TSLA due after the close
• DXY continues to slip amid receding yields and a recovery in the JPY as the BoJ ramps up intervention to anchor 10yr yields
• Core debt is experiencing a resurgence from recent sessions of pressure with Bunds eclipsing yesterday’s peak, aided further by well-received issuance
• WTI and Brent reside at the top-end of USD 2/bbl parameters; focus very much on China-COVID, Iran, Libyan supply and Ukraine-Russia developments
• Russia has lost its confidence in the Ukrainian negotiators, according to the Russian Foreign Ministry while Ukraine announces a Mariupol corridor has been agreed
• Looking ahead, highlights include Canadian CPI, US Existing Home Sales, French Election TV Debate, Speeches from Fed's Daly & Evans and ECB's Nagel & Rehn Supply from the US, Earnings from Tesla, Abbott, Procter & Gamble and United Airlines.

As of 11:10BST/06:10ET

LOOKING AHEAD

• Canadian CPI, US Existing Home Sales, French Election TV Debate, Speeches from Fed's Daly & Evans and ECB's Nagel & Rehn Supply from the US, Earnings from Tesla, Abbott, Procter & Gamble and United Airlines.
• Click here for the Week Ahead preview.

GEOPOLITICS

RUSSIA-UKRAINE

NEGOTIATIONS/TALKS

• Ukraine Deputy PM says a prelim. agreement has been achieved regarding a humanitarian corridor from Mariupol, via Reuters.
• Russia has lost its confidence in the Ukrainian negotiators, according to the Russian Foreign Ministry cited by NEXTA.
• Russian Kremlin says the ball is in Ukraine's court re. peace discussions, after Russia passed a document to them - says the pace of peace discussions leaves much to be desired, via Reuters. Would need to be a tangible reason for a Putin-Zelensky meeting.
• Bloomberg tweets "A small but growing number of senior Kremlin insiders are quietly questioning Putin's decision to go to war"; "They believe the Ukraine invasion was a catastrophic mistake that will set Russia back for years."

DEFENCE/MILITARY

• Russian troops seized the village of Kreminna in the separatist Luhansk region to claim the first ‘victory’ in its renewed offensive for Donbas, according to The Telegraph.

ENERGY/ECONOMIC SANCTIONS & UPDATES

• US has increased pressure on China and India for refusing to join Western sanctions against Moscow and is threatening to punish businesses that provide services to Russian airlines flying to Beijing, Delhi and other destinations, according to the Nikkei.
• India is to increase its Russian oil purchases, according to Sputnik citing reports.
• Speaker of the Russia's Duma says European countries must compensate Russia for the losses incurred by their economy as a result of the sanctions, according to Al Jazeera.
• Latvian Foreign Minister says EU is preparing new measures against Russia to avoid Moscow evade sanctions, via Reuters.

OTHER

• US officials are to visit the Middle East this week to de-escalate Jerusalem tensions, according to Sputnik.

EUROPEAN TRADE

EQUITIES

• European bourses and US futures were choppy at the commencement of the European session, but, have since derived impetus in relatively quiet newsflow amid multiple earnings and as yields continue to ease; ES Unch..
• Currently, Euro Stoxx 50 +1.8%, while US futures are little changed on the session but rapidly approaching positive territory ahead of key earnings incl. TSLA.
• Netflix Inc (NFLX) - Q1 2022 (USD): EPS 3.53 (exp. 2.89), Revenue 7.87bln (exp. 7.93bln), Net Subscriber Additions: -0.2mln (exp. +2.5mln). Q1 UCAN streaming paid net change -640k (exp.+87.5k). Co. lost 640k subscribers in US/Canada, 300k in EMEA, and 350k in LatAm. Co. Said macro factors, including sluggish economic growth, increasing inflation, geopolitical events such as Russia’s invasion of Ukraine, and some continued disruption from COVID are likely having an impact, via PR Newswire. Click here for the full breakdown. -26% in the pre-market
• Chinese Civil Aviation publishes prelim report looking into the China Eastern Airline crash; still recovering and analysing damaged black boxes from the plane: there was no abnormal communication between air crew and air controllers before the aircraft deviated from cruising altitude; no dangerous weather, goods or overdue maintenance.
• Click here for more detail.

FX

• Buck concedes ground to recovering Yen as US Treasury yields recede, USD/JPY over 150 pips below new 20 year high circa 129.42.
• Yuan on the rocks after PBoC set a soft onshore reference rate and regardless of unchanged LPRs, USD/CNH eyes 6.4500 after breach of 200 DMA.
• Aussie back in pole position as high betas benefit from Greenback retreat and Kiwi in second spot ahead of NZ CPI data; AUD/USD rebounds through 0.7400 and NZD/USD from under 0.6750.
• Loonie also bouncing before Canadian inflation metrics, with Usd/Cad closer to 1.2550 than 1.2625, while Euro and Pound are both firmer on 1.0800 and 1.3000 handles respectively as DXY dips below 100.500.
• Rand shrugs aside mixed SA CPI prints as correction from bull run continues and Gold slips under Usd 1950/oz, USD/ZAR holds above 15.0000.
• ECB's Kazaks says a rate hike is possible as soon as July this year; ending APP early in Q3 is possible and appropriate; zero is not an a cap for the deposit rate, via Bloomberg. Adds, a gradual approach does not mean a slow approach, do not need to wait for stronger wage growth.
• CNB Governor Rusnok says cannot rule out further interest rate hikes but any moves will likely be cosmetic.
• Click here for more detail.

Notable FX Expiries, NY Cut:

• EUR/USD: 1.0790 (422M), 1.0800-10 (1.2BN), 1.0875 (600M), 1.0930 (304M)
• Click here for more detail

FIXED INCOME

• Debt redemption, as futures retrace following tests/probes of cycle lows.
• Lack of concession not really evident at longer-dated German and UK bond sales, but 20 year US supply may be a separate issue.
• BoJ ramps up intervention and aims to anchor rather than cap 10 year JGB yield around zero percent, while BoA suggests contra-trend position in 10 year UST to target 2.25% from current levels close to 3.0%.
• Click here for more detail.

COMMODITIES

• Crude benchmarks are firmer on the session in what is more of a consolidation from yesterday's pressured settlement than a concerted effort to move higher, also benefitting from broader equity action.
• Currently, WTI and Brent reside at the top-end of USD 2/bbl parameters; focus very much on China-COVID, Iran, Libyan supply and Ukraine-Russia developments.
• US Private Energy Inventory Data (bbls): Crude -4.5mln (exp. +2.5mln), Cushing +0.1mln, Gasoline +2.9mln (exp. -1.0mln), Distillate -1.7mln (exp. -0.8mln).
• Spot gold/silver are contained at present but have seen bouts of modest pressure, including the loss of the USD 1946.45/oz 21-DMA at worst.
• Click here for more detail.

NOTABLE EUROPEAN HEADLINES

• UK government said the Competition and Markets Authority will be able to directly enforce consumer law and will have new powers to fine firms up to 10% of global revenue for mistreating customers, according to Reuters.
• UK plans to extend tariffs on glass fibre from China used in electric vehicles and wind turbine blades to protect the domestic market, according to SCMP.

NOTABLE US HEADLINES

• Fed's Kashkari (2023 voter) said the economy may still be vulnerable to new COVID waves and that inflation is far too high, while he added the Fed's job will get harder and they will need to do more to bring inflation down if supply chains don't improve as he hopes, according to Reuters.
• US President Biden's administration will appeal the ruling against the CDC travel mask mandate, according to Bloomberg.
• Click here for the US Early Morning Note.

CRYPTO

• Russia may consider using crypto in foreign trade, according to Izvestia.

APAC TRADE

EQUITIES

• APAC stocks eventually traded mostly positive after the firm handover from the US despite continued upside in yields.
• ASX 200 was led by the healthcare sector as shares in Ramsay Health Care surged due to a takeover proposal from a KKR-led consortium, but with gains capped by miners after Rio Tinto's lower quarterly iron ore production and shipments.
• Nikkei 225 was underpinned by the initial currency depreciation and with the BoJ defending its yield cap.
• Hang Seng and Shanghai Comp were mixed with the mainland subdued after the PBoC defied expectations for a cut to its benchmark lending rates and instead maintained the 1yr and 5yr Loan Prime Rates at 3.70% and 4.60%, respectively.

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 6.3996 vs exp. 6.3853 (prev. 6.3720)
• PBoC 1-Year Loan Prime Rate (April) 3.70% vs. Exp. 3.65% (Prev. 3.70%)
• PBoC 5-Year Loan Prime Rate (April) 4.60% vs. Exp. 4.55% (Prev. 4.60%)
• PBoC said it is to step up financial support for COVID control, as well as smooth logistic and supply chains. PBoC added that it will make good use of financial policies to support the service sector, consumption investment and small firms. Furthermore, it will keep the property sector financing stable and orderly, while it will flexibly adjust mortgage payment plans for home buyers impacted by COVID-19, according to Reuters.
• Shanghai official said the epidemic situation in the city has shown a downtrend in recent days and that two districts achieved zero COVID at the community level. Furthermore, the number of people categorised in highest risk "sealed areas" has reduced significantly, although 11.9mln residents are still confined to their homes under lockdown measures, according to Reuters and Bloomberg.
• Japan is considering handouts to low-income households with children, according to Asahi.
• BoJ offers to buy an unlimited amount of 5yr-10yr JGBs at a fixed rate of 0.25%, after the 10yr JGB yield touched the BoJ's yield cap.
• BoJ is to conduct consecutive unlimited fixed-rate, 0.25%, purchase operations for JGBs; to purchase 10yr JGBs #364, #365 & #366 on April 21st, 22nd, 25th and 26th.

DATA RECAP

• Japanese Trade Balance (JPY)(Mar) -412.4B vs. Exp. -100.8B (Prev. -668.3B, Rev. -669.7B)
• Japanese Exports YY (Mar) 14.7% vs. Exp. 17.5% (Prev. 19.1%)
• Japanese Imports YY (Mar) 31.2% vs. Exp. 28.9% (Prev. 34.0%, Rev. 34.1%)