Global Markets Mixed as Yields on 10-Year US Treasuries and German Bund Fluctuate

On Thursday, February 23, 2023, global markets were mixed as the yield on 10-year US Treasuries declined by two basis points to 3.93%. The yield on the 10-year German Bund rose by 1.05%, while the German DAX gained 0.49%.

Regarding commodities, Brent crude remained steady at $82.86 per barrel, while WTI crude saw an increase of 0.1% to reach $76.41 per barrel.[0] At 2:00 Eastern Time, U.S. crude futures had decreased 0.6% to $75.89 per barrel, and the Brent contract dropped 0.7% to $82.28[1] The yield on the 10-year U.S. Treasury rose by 5 basis points to 3.872% from 3.822%, and the yield on the 10-year German Bund rose by 3 basis points to 2.494% from 2.464%. When bond prices rise, yields fall, and when bond prices fall, yields rise.[2]

The STOXX Europe 600 gained 0.8% in morning trading.[0] The stock price of Orpea rose 5.6%, and Deliver[0] In contrast, Dechra Pharmaceuticals decreased by 12.5%, and Quilter declined by 4.2%.[0] The FTSE 100 saw an[0] European stocks rose, with France’s CAC 40 gaining 1.1% and Germany’s DAX rising 1.1%.[0]

In the foreign exchange market, GBP/USD continued to range between resistance at the 50-day SMA at 1.2180, and the support at the 200-day SMA at 1.1935. The 1.1935 level is targeting the 1.[3] EUR/GBP rallied from the 0.8780 area and currently finding resistance at the 50-day SMA at 0.8830 area. Support is seen around the 0.8870 level.[3] GBP/USD rebounded off the 200-day SMA at the end of last week, keeping the current range between support at 1.1920/30 and resistance at the 50-day SMA at 1.2180 intact.[4]

The European Central Bank has declared its intention to increase rates by an additional 50 basis points in March, though investors are examining the possibility of a larger increase.[5]

0. “US Futures, European Stocks Rise But Higher Rate Path Worries Return” MarketWatch, 27 Feb. 2023, https://www.marketwatch.com/story/us-futures-european-stocks-rise-but-higher-rate-path-worries-return-7926370b

1. “European stock futures mixed; investors on inflation data watch By Investing.com” Investing.com, 27 Feb. 2023, https://www.investing.com/news/stock-market-news/european-stock-futures-mixed-investors-on-inflation-data-watch-3014894

2. “US Futures Fall, European Stocks Mostly Down as Rate Worries Linger” MarketWatch, 21 Feb. 2023, https://www.marketwatch.com/story/us-futures-fall-european-stocks-mostly-down-as-rate-worries-linger-741460ea

3. “Europe set for higher open, as markets look to US PCE” FXStreet, 24 Feb. 2023, https://www.fxstreet.com/analysis/europe-set-for-higher-open-as-markets-look-to-us-pce-202302240600

4. “Europe set for higher open with US markets out for Presidents Day” CMC Markets, 20 Feb. 2023, https://www.cmcmarkets.com/en/news-and-analysis/europe-set-for-higher-open-with-us-markets-out-for-presidents-day

5. “European markets up 1.2% after worst week of the year; Commerzbank climbs 4.5% after DAX re-entry” CNBC, 27 Feb. 2023, https://www.cnbc.com/2023/02/27/european-markets-live-updates-stocks-data-news-and-earnings.html