Morning Report

April 21, 2022

“Representatives of the Western Nations, including the UK, US, and Canada, walked out of a G20 meeting in a protest movement against Russia’s invasion of Ukraine, amid growing fears that a breakdown in international relations would impact the global economy’s recovery from the pandemic and soaring inflation.”

Tim Hallinan – Trading Director

Main Headlines

The US said it would send more artillery to Ukraine to help it repel a renewed military offensive by Russia, which is pouring thousands of extra troops into the south and east of the country as it gears up for the next phase of the nearly eight-week-long invasion. Joe Biden, US president, responded “yes” when asked by reporters whether the Pentagon would send more artillery. The US is expected to announce another round of lethal aid in the coming days, two US officials said. The package is expected to be worth about $800mn and include artillery as well as anti-armour and anti-air equipment. Jen Psaki, White House press secretary, said Biden discussed providing more ammunition and security assistance on a call with allies including the leaders of Canada, France, Germany, Japan, Italy, Poland, Romania, and the UK. The leaders of the European Council, NATO and the European Commission also took part.

British Prime Minister Boris Johnson indicated he was ready to offer more visas to India in return for this year clinching a free-trade deal that could boost annual bilateral trade by billions of pounds. Speaking on the plane on his way to the world’s second-most populous country, Johnson signalled he was ready to be more accommodating on an issue that could have stalled the talks. Britain has made getting a trade deal with India one of its post-Brexit priorities as ministers, free from the European Union’s common trade policy, look to gear policy towards faster-growing economies around the Indo-Pacific region. Any trade deal will likely be contingent on relaxing rules and lowering of fees for Indian students and professionals going to the country. India and former colonial power Britain already share strong trade ties, and more than a million people of Indian origin live in Britain after decades of migration.


Sterling is stronger against the dollar and weaker against euro this morning. Boris Johnson has vowed to lead the Conservatives into the next election and urged people to focus on “things that matter,” ahead of a House of Commons vote on his handling of the party gate scandal. British Prime Minister Boris Johnson said any peace talks over Ukraine are likely to fail, as he compared holding talks with Russian President Vladimir Putin to negotiating with a crocodile. Jacob Rees-Mogg, the Brexit opportunities minister, told a committee of MPs that if the EU did not reform the so-called Northern Ireland Protocol, then the UK government was within its rights to take unilateral action. British rail travellers were threatened with a summer of potential travel disruption after the RMT transport union announced it would ballot its members over a nationwide strike in a dispute over jobs and pay.


Euro is well bid against most major currencies overnight. Emmanuel Macron, France’s president, has accused his far-right rival Marine Le Pen of being beholden to Vladimir Putin and of risking civil war in France with her plans to curb Islamism. Le Pen outlined her plans to drastically reduce “massive, anarchic” immigration, reform the EU and impose law and order. In a show of strength two months into its assault on Ukraine, Russia test-launched a new nuclear-capable intercontinental ballistic missile which President Vladimir Putin said would make Moscow’s enemies stop and think. G7 finance ministers said they have provided and pledged together with international community additional support to Ukraine exceeding $24 billion for 2022 and beyond, adding that they were prepared to do more as needed. The UK, US and Canada have staged a coordinated walkout of a G20 meeting in protest against Russia’s invasion of Ukraine, amid growing risks of division between leading nations hitting the world economy.


The dollar is weaker than most major currencies in the early morning trade. Chicago Federal Reserve President Charles Evans said that the US Federal Reserve should proceed sensibly in raising interest rates as it waits to see if special factors pushing up inflation begin to recede. Data from the Mortgage Bankers Association showed that the average interest rate on the most popular US home loan climbed to a 12-year high last week and fewer homebuyers sought properties in a sign that the Federal Reserve’s aim of cooling the housing market may be beginning to have an impact. Delta Air Lines and United Airlines will allow customers previously barred from flying for failing to wear masks to board flights again, the carriers said on Wednesday evening, after US authorities abruptly stopped enforcing face-covering requirements following a court ruling this week.


US and European futures climbed, and Asian stocks traded mixed Thursday with investors seeking clues on Chinese policy support and pondering a burgeoning debate around whether inflation is peaking. Treasuries pared a rally. Equities rose in Japan. They fell in Hong Kong and China where an address by President Xi Jinping failed to soothe investors pining for more measures to support growth. S&P 500 and Nasdaq 100 futures advanced after positive earnings from Tesla Inc. and United Airlines Holdings Inc. Rate markets underwent a sharp repricing yesterday, sending long bond yields sinking. Investors such as Bank of America Corp. and Nomura Asset Management said this is a buying opportunity after the recent rout. Ten-year yields trimmed a steep retreat, with central bank stimulus withdrawal looming large. The dollar pared a slide, and the yen resumed a decline.

Main Economic Data/Central Banks/Government (All Times CET)

8:45 a.m.: France April manufacturing confidence
10:00 a.m.: Poland March PPI, sold industrial output
11:00 a.m.: Euro-Area March CPI
2:30 p.m.: US weekly initial jobless claims
3:00 p.m.: BOE’s Mann speaks
4:00 p.m.: Euro-Area April consumer confidence
5:30 p.m.: US sells bills
6:30 p.m.: BOE’s Bailey speaks
7:00 p.m.: Fed’s Powell, ECB’s Lagarde on IMF panel
7:00 p.m.: US sells TIPS

Corporate Events

Earnings include AT&T, Blackstone, Danaher, Nextera, Philip Morris, Union Pacific, Intuitive Surgical, Marsh & McLennan, Dow, SVB, Snap, PPG, American Airlines, ABB, Sartorius


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