 Very good morning to you. It's Wednesday the 10th of March and it's just coming up to 7 a.m. Here in London So I just wanted to give you the regular briefing of what happened on the close of Wall Street overnight in Asia and then our kind of outlook for the day ahead and gonna kick things off with the heat map of the S&P 500 and what a different day makes It's almost the mirror opposite of what we had from yesterday Which was all of the big mega cat tech were lower now or higher? Reversing that move and in fact the Nasdaq 100 as an index posted its biggest rally since November As you can see here likes of Apple up 4% Amazon and Facebook similar margins But check out Tesla shares up 20% After they were getting hammered in some of that rotational play that we had been seeing Now risk sentiment generally as well supported By the latest three-year auction that came out the US we're gonna talk about that a bit more detail in a moment But this was the first of three auctions for the week and people were a little bit apprehensive given the weakness seen in the 7-year US auction two weeks ago and actually it came out Okay, and that actually provided a bit of relief yields actually dropped further after that auction Which further helped just general risk sentiment overall and just looking at the Nasdaq here on the chart for the time being and Bit of a range break as well of that previous double top of the week's price action Which came after we kind of surged out of the gate at the open on the Nizi yesterday And that also just helping some of the price activity from a technical perspective and obviously we just powered on up All the way into the close pretty much Before a little dip that was seen and the final half an hour of trade into the closing bell Faded a little bit in the overnight session the Asia pack region generally just kind of towing the line if you like and then mildly positive following the Positive handover that we had in the US But nothing to really read into in terms of the handover going into the European open where obviously we were in the Market yesterday to observe much of that rally so a couple of things here then so bit of a reversal of course after the Heavy selling pressure the Nasdaq have been seeing we've had a bit of a pop through here Technically through the week's top end of the range as you can see that has formed here on the daily It doesn't look You know 4% so definitely a big move and the biggest move in many months for the Nasdaq in a singular session But when you look at the chart on this perspective doesn't actually look that that big definitely though The the downside level that we've marked up before this kind of highlighted one at 12 to 34 Is the level that's held up so far that previous era of resistance and support going back through October November? December of last year and then the retest we've just had in the last couple of days will be a key one to watch Just generally going forward over the the medium term Just having a look then the other things I was reading last night when it comes to the Nasdaq was the FT We were reporting that some analysts said that some The big move that we had yesterday was propelled by short covering as well obviously there's been a lot of press coverage about how The the kind of switch through in the rotational play and the Text stocks would be the biggest casualties given the movement in the high yield environment and so perhaps yeah Bit of short covering as the market kind of has snapped up against people in those short positions could well be Part of that and perhaps that technical level as well Just helping further squeeze people out of some of those positions that we're looking at more optimal shorts And around that range high in the short term City group analysts and a note last night said that they saw such a shift or worn such a shift Could prove fleeting like what we saw yesterday and which could cap the size of the move Obviously if it is just short covering it doesn't really Change perhaps then generally people's fundamental perception that there's perhaps better sector positioning in other areas That have seen just generally greater outperformance against the tech and nasdaq heavy Well the tech heavy nasdaq of late the S&P S today finished up around 1.4 It was almost of the reverse that we've seen recently the dow was up just point one Compared to the 4% gains that were seen in the nasdaq. How sustainable is that? I Don't actually think it is sustainable, and I don't think that we've seen personally yet The bottom for the nasdaq but overall I must stress that this is still for me an idea of a little bit of movement across the Exposure that people want certain stock sectors. I still think ultimately when the economy Reopening globally that generally it's a it's a positive narrative for stocks in general It's just that some are going to outperform others and it's about strategic placement then to benefit from that move So that's the overnight Kind of session in China overnight one thing to mention was we did have some data So on the inflation side PPI rose at the fastest pace in more than two years in February 1.7% was above expectations at 1.5 Consumer prices fell 0.2% last month from a year earlier Slightly better than the projected 0.3% decline people are anticipating. Here's a here's a chart of these metrics just to give you a bit of context of the general pattern that we've had and Probably the biggest thing that you're seeing here is consumer prices are still remaining fairly flat line having having kind of crashed through the period of the pandemic of course just given the The sharp fall in inflationary conditions given the the onset of the pandemic and lockdowns and so forth But what's interesting now is that the Chinese economy has been reopening to a certain respect for some time economic Data which we're seeing you know sharp improvements in lots of the US recently That's been happening in China for some time and that then is leading to the PPI prices just moving further and further away that kind of Divergence that we're used to seeing through this period of recent years starting to materialize again. And so you've got Activity picking up but consumer still remaining a little luck luster This point in time in terms of their confidence. It would translate to Chinese producer prices have been a major contributor to global inflation In recent decades because if you think about supply chains and they've become more integrated generally speaking and Expensive oil given the surgeon prices that we've had a shortage of chip Computer chips Globally soaring shipping costs these could all be significant tailwinds for global inflationary pressures That may then reverberate down the line and make the cost of goods more expensive Just generally this all coming in that time where inflation expectations are rising generally with the opening Reopening of different economies around the world. So they're quite interesting to have a look at this It definitely kind of feeds into the more kind of aggressive people talking about inflation Emerging emerging in the future. This would would play to that Particular view overnight then the other things that we have had is that the dollar has firmed up a little bit during the Asia-Pacific session So the Dixie's trading up about a quarter of 1% So consequently the major pairs are trading a little bit softer this morning. I wouldn't say anything too dramatic More greenback based than I'd say individually euro sterling narratives that are driving these Currency markets at the moment. So euro and cable down about 25 pips each respectively One thing cable has failed obviously yesterday to reclaim the 139 handle Few people looking at the cross-channel tensions which are brewing at the moment with the EU nations saying that they're getting behind Brussels to plan to launch legal action Against the UK for easing the impact of Brexit on northern Irish Businesses so that still on going at the moment and there's been quite a lot of the vaccine supply manufacturing you still Kind of going back and forth between Britain and Europe at the moment that's worse just keeping half an eye on Otherwise the other market I just quickly wanted to comment on was oil WTI crude Has has moved substantially lower actually over the course of the last two days I mean from from the peak that we saw at the reopening of globex trade on Sunday night Which was up akin to $68 We're actually off nearly 7% from those highs and actually technically speaking We are trading beneath what what is quite an interesting near-term level You can see here was the previous highs of resistance back on the 25th 26th of February It helps support price after go pet plus decision last week on the initial Surgeon price on the pullback to them take us all the way up to where we were We're now below that point and that level was holding quite nicely into the US close last night But it's been broken down in the Asia pack session. So prices have drifted down We have had the API Oilipotries last night. I must stress that these are incredibly noisy at the moment So personally, I don't really put too much weight in them Specifically given the fact that as we saw last week, this is all Reflective the general disruptions that we saw in Texas and generally nationwide with the great freeze in the US just a few weeks ago But nonetheless the headline crude number was a build of twelve point seven nine two million I don't I'm not sure really where these analysts get these forecasts. I mean, it's so off Offbeat that and I don't think you should really look at that too much Just the fact that this is obviously incredibly sizable figure in a historical data context Cushing a bill of 300,000 gasoline draw of eight and a half million so yeah mixed and particularly noisy given those Those weather impacts that we we saw emerge in last week's data, but overall, I think with this oil price Coming on to a daily chart I think it's it's always really good to just look at the market in Perspective and you know the oil market has just been on an absolute tear since November Pretty much when we were trading at one point down at a low $30 mark And we've got all the way up to you know, the best point is 68 bucks all thereabouts on the high So if I look at two kind of things here, even if we were just looking at the recent price surge that we've had over Since the 3rd of March to the peak that was 14% So we're still up a good 7% even with the pullback that we've had even if you're looking from February Where there's an initial or latest phase of of bid has come in then we're still up about 22% and if you go from November low in oil, we're still up about 87 88% so for me, I know on the intraday market this feels Quite heavy in the price, but ultimately I really don't see a great deal here that makes me nervous for what still is more a Generally bullish view that I maintain for oil I'm sure as their price is their scope for this price to pull back They certainly might be the thing I'd be looking at as a trigger for that would be the dollar in the short term if you're trading intraday But I still think that will remain Our heads above this kind of 60 marker for for the time being for the rest of this week. I would anticipate okay, one of the other things I just wanted to mention was then the Auction that we had last night and actually just looking here. It's going to keep the US 10 year up for a moment and The US auction last night for the three came out here. I'm obviously looking at the 10 year rather than Shorter data maturities just for the sake of you know, we tend to focus on the benchmark for trading purposes But the 10 year moved up from around 05 prior to release and we saw a peak At around 15 and a half so decent 10 tick move there Don't get me wrong. Yields were already pulling back anyway through the UK European and US sessions So definitely that was helping contributing to the surge back into Short-term some of the equity space and the tech names in particular But then was given a further bump on the three-year auction. So just running you through what exactly happened there The auction priced at zero point three five five percent, which was well above last month's zero point one nine percent And was solidly or zero point four basis points below the zero point three five nine percent when issued So it was definitely a million miles away from the massive tail that we saw in The seven-year auction two weeks ago and a big tail for bond auctions means that there's really a lack of demand For that that particular issue and that bids generally are quite uncompetitive The bid to cover was also pretty impressive. It came in At two point six eight nine from two point three nine one previous then was the highest bid to cover ratio We've had since June of 2018 Then although the what we call the the internals of the auction were a little bit softer generally speaking There was just a kind of relief a lot. There's a hundred and twenty billion I think in total coming to market and issuance this week and you know Just given how bad that seven-year was and that the price dropped at that saw and just another reason for the whole High-yield move people were a little bit apprehensive going to this first one I would say that the ten-year auction tonight arguably is more important just given its maturity and that'll be at 6 p.m. London time But overall, yeah, bit of a sigh of relief for markets yesterday And I think that did play its hand into some of the the general risk Appetite that was being observed in the intraday the whole Treasury curve After the after the complete breakdown of non dealer community participation in last month's seven-year auction Benefitted from from the news when it came out One thing that was quite interesting that the guys at newscourt pointed out was they said part of the underlying demand is likely to be Investors seizing the attractive carry or roll Attributes of the three-year which offers double the yield of the two-year So obviously as a participant you're going to want a lock locking and a better yield of possible and just given them Rolling over and carries on a similar dated maturity. Was this actually more? Functional if you'd like from an operational point of view to kind of support demand rather than actually underlying to general appetite In some respects, so I still think there's some to play for for the ten-year tonight And I think that's definitely warrants watching as a main key event for for the session ahead Now the other final thing I wanted to mention on the calendar side of things is you do have the senior house Democrat Hoyer said last night that basically He anticipates the house to consider and pass the COVID-19 Stimulus bill at 9 a.m. Eastern. So bit late from this afternoon, London time Today and when that bill passes in the house, it would then go straight to bind for signing into Interplace now don't really see much now with this particular Situation other than the formalities to be quite to quite honest So there's something to be aware of in terms of headlines. I'm sure you'll see in a few hours time Calendar wise then the UK European morning is particularly quiet. There's nothing major happening So that takes us into the US session where there is Which is really the US CPI numbers at 130 where the expectation here for the headliners at 1.7 percent Against expectations of 1.4 percent Again, the core readings will be quite important the headline how influenced is it being from just generally Surging oil prices that we've had of late But just again given the sensitivity to inflation and subsequently then your reactions It's definitely worth keeping an eye on the CPI data 130 and their bond auction at 6 p.m You've then got the Bank of Canada Rate decision at 3 o'clock and you've got the oil in the trees from the Department of Energy at a regular time of 330 as well And that is it So gonna leave it there let you guys get on with a day any questions at all Just feel free to drop me a comment if you're watching this on YouTube happy to help and thank you for getting us to Over 20,000 subscribers now on the channel massively appreciate it and then otherwise for the community I'll see you online in the discord room. Thanks so much guys. Have a good day