The war in Ukraine has tended to increase uncertainty regarding inflation and growth prospects. When and with what consequences this war will end is pure speculation, but capital markets are expected to build a certain immunity to the headline risks in the coming weeks. The medium- to long-term consequences, on the other hand, could be significant. It is possible that we are at the beginning of a new bloc formation or a new Cold War. This would put a significant damper on globalisation and further fuel higher structural inflation. 

US stocks ended sharply lower on Wednesday, with the Nasdaq dropping more than 3% and the Dow falling for the fifth straight day after US inflation data did little to ease investor worries over the outlook for interest rates and the economy. The S&P 500 lost 1.7% and is now down 18% from its Jan. 3 record closing high. It was a different story in Europe where all major indices closed well above the flatline, led by energy, luxury and auto stocks and supported by upbeat earnings reports. 


  • Shares in Asia were mixed early morning with the mainland Chinese stocks outperforming the broader markets on hopes the omicron variant can come under control sooner rather than later. Markets elsewhere in the region largely declined, with losses of around 1% in Japan, Hong Kong and Australia. 
  • European stocks are expected to fall sharply at the open while US stock futures were seen slightly higher. 
  • Oil prices fell more than 1% on Thursday, giving back some gains after rallying by over 5% in the previous session, as economic uncertainties and recession fears outweighed supply concerns and geopolitical tensions in Europe. Oil prices jumped on Wednesday after Russia sanctioned 31 companies based in countries that imposed sanctions on Moscow. 
  • The annual inflation rate in the US slowed to 8.3% in April from a 41-year high of 8.5% in March, but less than market forecasts of 8.1%. On a monthly basis, consumer prices were up 0.3%, slightly more than expectations of 0.2% but below a 16-year high of 1.2% in March. 
  • Oil giant Saudi Aramco on Wednesday surpassed Apple as the world’s most valuable firm. Aramco’s market valuation is now just under $2.43 trillion, while Apple’s valuation has fallen to $2.37 trillion after shares fell more than 5% during Wednesday’s session. 
  • Siemens this morning reported a decline in profit during the six months ended March 31 due to higher expenses. Earnings per share amounted to €3.29, compared with €4.49, in the year-ago period. The company confirmed its financial outlook for this year, expecting comparable revenue to grow in the range of 6% to 8%. 
  • Also this morning, Allianz said that first quarter profit plunged 78.1% year over year due to a further €1.9 billion provision to address lawsuits and regulatory probes regarding the collapse of its Structured Alpha funds. The company reiterated its full-year target of €13.4 billion in operating profit, plus or minus €1 billion. 
  • Rivian Automotive reported a narrower than expected loss for the first quarter and maintained its 2022 production target of 25,000 vehicles. 
  • Walt Disney reported stronger than expected growth in streaming subscribers across its media platforms for the most recent quarter, but warned that it is still seeing the impact of Covid in its theme parks in Asia. 
  • Chinese property developer Sunac China announced today that it failed to cure the missed 11 April 2022 coupon on its 7.95% senior notes due October 2023 with in the grace period that expired yesterday and does not expect to make payments on its other senior notes when they become due or within the relevant grace periods. 
  • Italian Prime Minister Mario Draghi said European companies will be able to pay for gas in rubles without breaching sanctions, apparently dismissing European Union guidance to the contrary.