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Below are Views On Daily Global Market Update 28 December 2021 By Asheesh Chanda, Kristal.AI

Santa Rally

S&P hit another record high (for the 69th time this year) to close just shy of the 4800 level. All sectors were in green led by Tech and Energy. Historically, this has been a positive time for the index with the median gain in the last week & first two days of the new year at around 1.3% (since 1969). Yesterday's single day gain has exceeded that number already. JP Morgan released a note saying there was no reason for the rally to end with record buybacks, retail flows and low positioning. The narrative around the virus and hawkish banks is overdone in their opinion.

The US dollar was flat buy FX vol was bid up in most pairs. The US yield curve got flatter as the 2Y moved up a leg despite a mostly positive auction. Inflation break evens moved up too, indication market expectations were turning more hawkish. Crude's rally continued but Crypto saw some pullback on the day. Gold has stayed stable around the 1800 level for no. US HY spreads have compressed once again to their pre-Evergrande lows with Asian HY mostly sideways.”

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