Morning Report

Morning Report – Thursday 22 April

Jon Robson, Head of Trading

“Softer treasury yields are reducing demand for U.S. fixed-income assets and the dollar is pinned near multi-week lows against most majors. Any optimism from the ECB or hints of tapering bond purchases after today’s council meeting could translate into a stronger euro however, major fiscal decisions are unlikely until June.”

Main Headline

US President Joe Biden is set to announce the country’s steepest ever emissions cuts, as he hosts 40 world leaders today for a virtual summit on climate change that will include China’s Xi Jinping and Russia’s Vladimir Putin. The US will attempt to re-assert its global leadership on climate change: it is expected that updated carbon pledge will be unveiled that will see their greenhouse gas emissions reduced by as much as 50 per cent by 2030 relative to 2005 levels. Climate envoy John Kerry said the US would probably begin requiring companies to disclose information on climate risk.

Covid passports will be made available as early as next month, in time for summer holidays, the Telegraph has reported, citing a telephone call between government officials and travel industry figures. The Department for Transport wants an official certification scheme in place by May 17. The proof of having received a Covid jab would be certified by UK Government, meaning it would be accepted by countries demanding evidence before entry.


Sterling is stronger against most major currencies this morning. The number of UK companies in significant financial distress has risen at the fastest rate in more than seven years, sparking warnings that “the dam of zombie businesses could be about to break” when government Covid-19 support comes to an end in the summer. More than 720,000 businesses are now in significant financial distress, meaning that they have minor county court judgments filed against them or which have a sustained or marked deterioration in key financial ratios and indicators such as working capital, profits and net worth.


The euro is higher versus the dollar and lower versus other majors overnight. European Central Bank President Christine Lagarde will be pressured to reveal how much longer the euro area will need intensified support, after ECB governing council hold a meeting later today. It is anticipated that the ECB will continue buying bonds at an accelerated pace to support financing conditions at least until updated projections for growth and inflation will become available in June.


The dollar is lower against most majors in early morning trade. Securities and Exchange Commission officials are considering tougher disclosure requirements for investment firms in response to this year’s implosion of Archegos Capital Management and trading gyrations in GameStop Corp. Elsewhere, US wood prices are racing higher, blasting through previous records as sawmills struggle to keep pace with demand in the run-up to peak homebuilding season.


Japan outperformed, while Hong Kong and Australia had more modest gains. U.S. futures edged lower, while European futures rose. Treasury yields fell, with the 10-year dropping below its 50-day moving average for the first time since November. Oil added to losses with an increase in U.S. crude inventories compounding concerns around a choppy global demand recovery. Earlier, most major groups in the S&P 500 rose, with raw-material, energy and financial shares leading the charge. A gauge of small caps climbed more than 2%, outperforming major benchmarks.

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

8:45 a.m.: France April manufacturing confidence

9:00 a.m.: Turkey April consumer confidence

10:30 a.m.: Spain sells bonds

10:50 a.m.: France sells bonds

11:00 a.m.: Euro-Area 2020 government debt/GDP ratio

11:50 a.m.: France sells linkers

1:45 p.m.: ECB rate decision

2:30 p.m.: ECB’s Lagarde speaks

2:30 p.m.: U.S. initial jobless claims

4:00 p.m.: Euro-Area April consumer confidence

U.S.’s Biden hosts virtual climate summit, which runs through April 23.

Earth Day 2021

Corporate Events

Earnings and sales updates include Hermes, Renault, Pernod Ricard, Volvo, Orange, Vivendi, Moncler, Intel, AT&T, Blackstone, Snap

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