Rising fears of a war breakout between Russia & Ukraine and FED would start rise rate from March 2022 are dragging equity markets. Invasion of Russia on Ukraine would have ripple effects in markets as it also shows US couldn�t contain the crisis, this would boost confidence for China to invade over Taiwan.
Domestic market participants will closely watch the ongoing Assembly polls taking place in five states - Manipur, Uttar Pradesh, Punjab, Goa, and Uttarakhand. The voting for Phase 4 and Phase 5 in Uttar Pradesh and Phase 1 in Manipur will take place in the coming week. Ongoing assembly polls would add extra volatility to Sensex & Nifty.
Investors will watch out for developments in Russia and Ukraine matter. On the data front, Markit services and manufacturing PMIs from the US, UK, Germany, France, Euro Area and Japan.
FIIs/FPIs have sold Rs. 333 billion in January 2022 and Rs. 153 billion in February 2022. Foreign Institutional Investors (FIIs) Derivative Statistics have shown a rise in the open interest (OI) in stock futures, index options, stock options and index futures.
Wallstreet indices closed on negative note amid comments from President Mr. Joe Biden spooked investors, Pentagon is sure about Russia�s invasion on Ukraine as the see heightening of Russian military activity near borders of Eastern Ukraine. Meanwhile, St. Louis Fed Bullard warned that inflation could get out of control without rate hikes, shows desperation of policymakers to bring back inflation under targeted levels of 2% from 7.5% seen in January 2022. During the week, Dow Jones declined by 1.90%, Nasdaq slipped by 1.71%, and S&P 500 down by 1.4%. �
European equity markets reversed gains to close in the red on Friday, with DAX down more than 1% amid renewed concerns over Russia-Ukraine tensions. During the week, DAX down by 2.48% and FTSE fell by 1.93%.
Crude oil prices were under pressure as the tensions between Russia and Ukraine escalated and concerns of supply disruption supported the prices. Surprisingly US witnessed weekly rise in crude inventories. On weekly basis, brent crude oil prices were down by 1%.
Gold prices rose by 2.1% during the week during as its safe-haven appeal was boosted by growing geo-political tensions. Gold touched mark close to USD 1900 per ounce.
Global Economy
The Euro Area current account surplus narrowed to EUR 35 billion in December 2021 from EUR 42 billion in the corresponding month of the previous year, as the goods surplus fell sharply to EUR 17.4 billion from EUR 38.7 billion.
Japan's consumer prices rose by 0.5% (Y-o-Y) in January 2022, easing from a 0.8% gain a month earlier which was the steepest pace in 2 years while pointing to the 5th straight month of increases.
Japan's trade deficit jumped sharply to JPY 2,191.1 billion in January 2022 from JPY 327.2 billion in the same month a year earlier and compared with market consensus of a gap of JPY 1,607 billion.
The number of Americans filing new claims for unemployment benefits increased by 23,000 to 248,000 in the week ended 12th February 2022, compared with market expectations of 219,000.
Industrial production in the United States increased 1.4 percent from a month earlier in January of 2022, recovering from a 0.1 percent fall in December and beating market expectations of a 0.4 percent increase.
US crude oil inventories rose 1.121 million barrels to 411.5 million barrels in the week ended 11th February, after a 4.756 million drop in the previous period and compared with market forecasts of a 1.572- million-barrel fall, data from the EIA Petroleum Status Report showed.
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