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Market Review

US:

Bulls U.S. stocks fell Thursday as shares of technology companies and other high-growth stocks succumbed to another selloff in the government bond market.

Asia:

Asian stocks weakened Friday after U.S. shares fell from a record while Treasury yields steadied around the highest levels in over a year, as the Federal Reserve’s tolerant stance on inflation unnerved investors.

India:

Markets came-off sharply in the noon deals on Thursday as US Treasury yields recorded a steep uptick of 5% to hit 1.74%, causing equity holders to unwind their long positions. Besides, a single-day increase of over 35,800 Covid-19 cases in India, the highest since December 6, 2020, made market participants question the sustainability of the economic recovery.

Given this, the S&P BSE Sensex index eventually ended at 49,216.5 levels, down 585 points or 1.2%. On the NSE, the Nifty50 hit an intra-day high of 14,875 but dropped nearly 400 points to hit a low of 14,479before closing at 14,558 levels. Market is expected to open gap down and likely to witness negative move during the day.

Global Economy:

The yields on U.S. Treasury bonds jumped overnight despite the Federal Reserve’s assertion Wednesday that an interest rate hike is not anywhere on the horizon. The United States 10-Year touched a 14-month high of 1.75% while that on the United States 30-Year bond hit 2.51%. The 30-year yield is its highest since August 2019.

The number of Americans filing new claims for unemployment benefits unexpectedly rose last week, but the labor market is regaining its footing as an acceleration in the pace of vaccinations leads to more businesses reopening. Initial claims for state unemployment benefits increased 45,000 to a seasonally adjusted 770,000 for the week ended March 13, from 725,000 in the prior week. Economists had forecast 700,000 applications in the latest week.

Commodities:

Oil was up Friday morning in Asia, despite persistent fuel demand concerns and a strengthening dollar remaining as challenges to be overcome. Gold prices fell on Friday, pressured by a surge in U.S. Treasury yields and a rebound in the dollar, but the metal's jump to a two-week high in the previous session set it on track to record a small weekly gain.

Currency:

The safe-haven U.S. dollar strengthened again on Friday, supported by higher Treasury yields and falling stock markets, as investors continued to digest the Federal Reserve's pushback against expectations of any early interest-rate hikes.

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