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Futures Slide, Dollar Surges Ahead Of Powell-Yellen Doubleheader On Fresh Virus Fears

Futures Slide, Dollar Surges Ahead Of Powell-Yellen Doubleheader On Fresh Virus Fears

Lockdown fears are back, and so are concerns that disinflation may be making a return.

Global markets and US index futures slumped alongside shares in…

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Futures Slide, Dollar Surges Ahead Of Powell-Yellen Doubleheader On Fresh Virus Fears

Lockdown fears are back, and so are concerns that disinflation may be making a return.

Global markets and US index futures slumped alongside shares in Europe, where a resurgence of virus cases and a planned lockdown in Germany cast doubt on the region’s economic recovery. Bond yields tumbled and the dollar jumped towards recent peaks on Tuesday with markets in a cautious mood ahead of Congressional testimony by Fed Chair Jerome Powell and Treasury Secretary Janet Yellen for clues on the pace of economic rebound.

At 715 a.m. ET, Dow E-minis were down 137 points, or 0.42%, S&P 500 E-minis were down 11.75 points, or 0.31% and Nasdaq 100 E-minis were down 7.00points, or 0.05%.

Energy giants Chevron, Occidental Petroleum and Exxon Mobil all dropped between 1.5% and 3.5% premarket as oil prices tumbled 3% on fears that new pandemic curbs and slow vaccine rollouts in Europe will slow a recovery in demand. Apple, Facebook and Microsoft eased between 0.2% and 0.7% from the previous session’s jump. Shares of beloved meme stock GameStop, which is transitioning itself into an ecommerce firm, dropped 0.6% ahead of its fourth-quarter results due after markets close. U.S.-listed shares of AstraZeneca Plc fell 2.5% after a U.S. health agency raised fresh doubt on the results of the drugmaker’s large-scale COVID-19 vaccine trials.

A mixed bag of new Western sanctions on China, coronavirus concerns and Turkish tumult after President Tayyip Erdogan’s shock sacking of the central bank chief at the weekend left investors awaiting a firmer signal.

Adding to market jitters were further worries over the efficacy of the AstraZeneca Plc vaccine developed with Oxford University after a U.S. health agency said the drugmaker may have included outdated information in its data. Also, Germany imposing a strict Easter lockdown is sapping sentiment with European futures near session lows. Restrictions are less severe than earlier this year, yet lockdowns beyond March raise the risk of delaying the 2Q rebound.

Europe's Stoxx 600 Index fell 0.5% in early trading with automakers and energy shares down the most among sectors after Chancellor Angela Merkel put Germany into hard lockdown over Easter to try to calm another wave of infections. The move come amid signs that progress against the pandemic is stalling as global cases creep higher. European airlines and travel stocks declined again amid renewed concern on the summer holiday season and on the extension of restrictions to curb the Covid-19 pandemic. The Stoxx 600 Travel & Leisure Index is down 0.9% compared with a 0.4% drop for the broader equity gauge. Sliding oil also dragged down the Stoxx Europe 600 Energy Index which fell 0.8% extending its retreat to a seventh day as oil prices decline on concern near-term demand outlook. The Energy index is down 5% since March 12.

While a fresh lockdown in Europe’s largest economy is putting investors on the back foot, the stabilization in bond yields is providing some relief against fears that heavy U.S. spending could reignite inflation and force tighter central-bank policy. All eyes turn to Washington later today, where Treasury Secretary Janet Yellen and Federal Reserve Chair Jerome Powell will speak on the pandemic response. “The path for equity from here is likely to remain choppy, in particular for less cyclical and long duration equity, as further steepening of the U.S. yield curve driven by real rates can further weigh on equity valuation,” Goldman Sachs Group Inc. strategists led by Alessio Rizzi wrote in a note.

Europe's weakness echoed a downbeat mood earlier in Asia where MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 0.66%, hurt by a 0.95% fall in Chinese blue chips as a fresh wave of U.S. and European sanctions related to human rights abuses in Xinjiang hit. Stocks fell as investors sold financial companies after a drop in bond yields as well as other stocks expected to benefit from reflation and economic reopenings. Equities indexes in Tokyo, Hong Kong, Shanghai, Taipei, Soul and Sydney all traded lower. Banks including Japan’s MUFG and Sumitomo Mitsui Financial were among the biggest drags on the MSCI Asia Pacific Index as the 10-year U.S. Treasury yield fell for a second day. Automakers such as Toyota Motor and Geely Automobile also weighed on the measure. Benchmark indexes in Hong Kong and China led losses in the region as stricter regulations on the e-cigarette industry rippled through the markets. Traders also pointed to profit-taking on the carbon-neutral theme. Japan’s Topix swung to a loss of 0.9% from a gain of 0.6%, as investors were seen cashing in on recent advances in shares of banks and shipping firms. Main equity gauges in South Korea, Malaysia and Vietnam also ranked among notable decliners, while the Philippine benchmark posted Tuesday’s biggest gain.

Japanese stocks fell, with the Topix capping its steepest two-day drop in a month, as banks and shipping shares slid on profit-taking. Both sectors were among the biggest decliners on the Topix, which erased an earlier advance of as much as 0.6%. A gauge of shipping stocks has surged 41% this year, the best performance on the benchmark, while a measure of bank stocks has risen 32% amid expectations for an economic rebound. “The cheap valuation stocks that have been rising recently, including banks and marine transportation, are falling on profit-taking,” said Ryuta Otsuka, a strategist at Toyo Securities in Tokyo. “The shares went up a bit too much on expectations of an economic recovery.” Automakers continued to drop amid ongoing concerns over the supply of semiconductors. The Topix’s subgauge for the sector slid more than 3% Monday after a fire last week halted one of chipmaker Renesas Electronics Corp.’s largest plants, exacerbating a growing global shortage of automotive chips. “We believe the fire is likely to have a relatively heavy impact on Japanese automakers, which were relatively unaffected by chip shortages,” Arifumi Yoshida, a Citigroup analyst, wrote in a report. The Nikkei 225 Stock Average declined for a third day. The gauge has fallen more than 4% since March 19, when the Bank of Japan announced its decision to focus on buying exchange-traded funds linked to the Topix.

In FX, the dollar which has emerged as a global safe haven, surged as markets turned their attention to an update from Powell. In remarks prepared for delivery to a congressional hearing on Tuesday morning, the Fed chief said the U.S. economic recovery had progressed “more quickly than generally expected”. Powell is expected to reiterate his confidence in the economy’s growth while cautioning the recovery is far from complete. Yellen is likely to paint an optimistic picture of the economy before the U.S. lawmakers later in the day. Their congressional hearings begin at 12 p.m. ET.

"We kind of know where the Fed is at in terms of yields, inflation and accommodation. We will want to hear a lot more about what Yellen says on additional stimulus,” said Neil Wilson, chief market analyst for Markets.com.

"The FOMC last week laid out pretty clearly what the Fed’s view is with regard to rates... the next thing that markets will focus on is maybe getting some details from Yellen with regard to further infrastructure investment," said Alex Wolf head of investment strategy for Asia at J.P. Morgan Private Bank, referring to a statement from the Federal Open Market Committee.

The New Zealand dollar hit a three-month low after the government introduced taxes to curb housing speculation, a move investors reckoned could allow the central bank to hold interest rates lower for longer with less risk of a property bubble. The kiwi slid as much as 1.6% against the dollar to its lowest since December as leveraged funds added short positions on the currency to trigger sell stops against the greenback, according to an Asia-based FX trader. Turmoil in Turkish assets continued in the wake of the central bank chief’s surprise dismissal over the weekend, with a drop in the main stock index triggering a circuit breaker.

In rates, 10-year U.S. Treasury notes last yielded 1.6382%, down 6 bps on the session and sliding from 1.732% late on Friday. The 10Y outperformed bunds and gilts by ~3bp; 2s10s is flatter by nearly 6bp on the day, 5s30s by ~1bp. The benchmark 10-year German government bond yield dropped 1.9 basis points to -0.3290% as Monday’s plunge in the Turkish lira and lingering concerns over coronavirus infection rates drove investors to safer assets.

The Treasury sells $60BN in 2-year notes at 1pm ET beginning a cycle that includes $61b 5-year and $62b 7-year Wednesday and Thursday; as a reminder a poorly bid 7-year auction last month unleashed a disorderly bond selloff. IG credit issuance slate includes Nomura 5Y, 7Y, 10Y and Rentenbank 5Y; Oracle raised $15bn in 6 parts Monday on an order book said to exceed $35BN.

Oil prices fell 4%, hit by concerns that new pandemic curbs and slow vaccine rollouts in Europe will hold back a recovery in demand along with fresh travel restrictions. Brent crude futures dropped by $2.59, or 4%, to $62.03 a barrel by 1108 GMT. WTI crude futures fell by $2.43, or 3.95%, to $59.11 a barrel.

“Global travel is still looking like it could be a while away,” said Matt Stanley, a fuel broker at Star Fuels in Dubai, adding that a second-half recovery in oil demand looked doubtful as lockdowns remain the order of the day.

Spot gold rose slightly to $1,740 per ounce by 1100 GMT, buoyed by easing U.S. Treasury yields, while bitcoin traded around $54,000.

Looking at the day ahead now, the main highlight will likely be the appearance of Fed Chair Powell and US Treasury Secretary Yellen before the House Financial Services Committee. Other central bank speakers Bullard (9am and 4:20pm), Bostic (10:10am), Barkin (11am), Brainard (1:30pm and 3:45pm) and Williams (2:45pm), as well as BoE Governor Bailey, Deputy Governor Cunliffe and Chief Economist Haldane, along with the ECB’s Villeroy. Data highlights from the US include February’s new home sales and March’s Richmond Fed manufacturing index. Meanwhile the UK will be reporting its employment data for January. Finally, today sees parliamentary elections taking place in Israel.

Market Snapshot

  • S&P 500 futures down 0.4% to 3,915.25
  • SXXP Index down 0.4% to 422.63
  • MXAP down 0.7% to 206.47
  • MXAPJ down 0.7% to 684.82
  • Nikkei down 0.6% to 28,995.92
  • Topix down 0.9% to 1,971.48
  • Hang Seng Index down 1.3% to 28,497.38
  • Shanghai Composite down 0.9% to 3,411.51
  • Sensex up 0.4% to 49,980.89
  • Australia S&P/ASX 200 down 0.1% to 6,745.40
  • Kospi down 1.0% to 3,004.74
  • Brent futures down 2.7% to $62.85/bbl
  • Gold spot down 0.1% to $1,737.65
  • U.S. Dollar Index up 0.4% to 92.08
  • German 10Y yield down 2 bps to -0.33%
  • Euro down 0.4% to $1.1887

Top Overnight News from Bloomberg

  • The economy seems to be gathering steam, though it is still far from fully recovering from the damage wrought by the pandemic, Federal Reserve Chairman Jerome Powell said
  • Chancellor Angela Merkel and regional leaders agreed to put Germany into hard lockdown over Easter to try to defuse a “third wave” of Covid-19 infections fueled by faster-spreading mutations
  • AstraZeneca Plc may have released outdated information about its Covid-19 vaccine trial, giving an “incomplete” view of the efficacy of the shot, said the leading U.S. agency on infectious diseases
  • The European Union and Britain are pursuing talks to break their deadlock over AstraZeneca Plc’s coronavirus shots

Quick look at global markets courtesy of Newsquawk

Asian equity markets deteriorated throughout the session with the initial euphoria from the tech-led gains on Wall Street and the softer yield environment derailed as Chinese markets entered the fray following the latest sanctions announcements. ASX 200 (-0.1%) began positively amid strength in utilities and telecoms although gains were then wiped out as financials suffered due to softer yields and amid insurance claims from the ongoing flooding with warnings issued for Victoria state and east of the country. Nikkei 225 (-0.6%) was lifted at the open following the positive handover from US peers and with Goldman Sachs raising its 12-month target for the Nikkei 225 and TOPIX by 8.8% and 10.8% to 32,250 and 2,150, respectively, before the index eventually succumbed to the headwinds from currency inflows. Hang Seng (-1.3%) and Shanghai Comp. (-0.9%) were the worst performers and dragged down their regional peers after the US, Canada, UK and EU announced an array of sanctions on China over Uyghur Muslims to which China responded with its own travel bans and stated that the measures were based on lies and disinformation, while Baidu’s Hong Kong debut was viewed as a damp squib in which the Co.'s shares reversed early minimal gains. Finally, 10yr JGBs traded indecisive but held on to Monday’s gains with price action contained amid an indecisive risk tone and softer demand at the enhanced liquidity auction for 2yr, 5yr, 10yr and 20yr JGBs, while New Zealand yields were hit overnight with the 10yr down over 6bps following the government announcement of a NZD 3.8bln fund to accelerate housing supply and curb the rising house prices.

Top Asian News

  • Central Bank of Erdogan Has Foreign Cash Exiting Turkey; Turkish Stocks Sink, Flipping Circuit Breakers for Second Day
  • China’s Stock Benchmark Falls Back to Key 5,000 Support Level
  • Singapore Joins Wall Street in Planning for Return to Office
  • Thai Billionaire Betting on Tourism Rebound Eyes Troubled Hotels

Stocks in Europe kicked off the session with relatively broad-based losses across the board, but have since lifted off worst levels (Euro Stoxx 50 -0.3%) despite a distinct lack of fresh news flow throughout the morning and following on from a mixed APAC lead. Major bourses see broad-based losses, with the Euro Zone initially experiencing volatility in the DAX (-0.2%) as Germany is facing more stringent COVID-related measures during the Easter period. However, the FTSE MIB (-0.8%) currently stands as the laggard amid its large exposure to cyclicals coupled with some potential jitters over the COVID situation in neighbouring countries. Elsewhere, the FTSE 100 (-0.4%) underperformed at the open amid currency dynamics and losses across oil majors, but the UK index now trades in-line with regional peers somewhat aided by pressure in GBP. US equity futures are also subdued but with the cyclically led RTY (-1.3%) the clear underperformer vs the NQ (-0.2%), YM (-0.4%), and ES (-0.4%). This anti-cyclical tone is also reflected across European sectors as Autos, Oil & Gas, Leisure and Basic resources reside at the bottom. Autos continue to be hit by the ongoing chip shortages, with the EZ lockdowns only adding to the glum tone. Oil & Gas has been hit by notable losses in the crude complex. Travel & Leisure is battling with the less rosy outlook for the sectors, with reports via UK press also suggests that the threat of penalties for holidaying to remain in place until end-June, although the UK Health Secretary remarked that timings do remain unchanged. Nonetheless, the EZ measures to stem the rising infection rates have hindered the sectoral recovery. The upside meanwhile sees defensive sectors, with Consumer Staples, Utilities and Telecoms in the green whilst Healthcare is pressured by Roche (-1.4%) as the group discontinued trials of their Huntington's disease treatment candidate tominersen based on the results of a pre-planned review of the data. Further downbeat omens for the sector could also emanate from AstraZeneca (-1.2%) as US officials said the Co. might have included outdated information from its Covid-19 vaccine trial, providing an “incomplete” view of the data. In terms of individual movers, Volvo (-6.7%) resides as a notable laggard at the foot of the Stoxx 600 after its stated that the global semiconductor shortage will have a substantial impact on Q2 production and is expected to hurt earnings and cash flow.

Top European News

  • Carlyle Agrees to Buy $1 Billion U.K. Online Luxury Retailer END
  • Hungary’s Doctors Plead for Harsh Lockdown as Deaths Hit Records
  • Trustpilot Surges in Debut as London IPO Raises $655 Million
  • Denmark Says Lockdowns Can End Once All Over-50s Vaccinated

In FX, almost all change down under as the Kiwi unwinds all and more of its recovery gains through 1.0800 vs the Aussie to slide below 1.0850 and not far from 1.0900 in wake of the NZ Government launching a Nzd 3.8 bn housing fund to boost supply and curb a rise in prices with the ultimate aim of preserving economic stability. The moves takes some of the onus off RBNZ monetary policy following an amendment to the remit to incorporate property price inflation and aside from Nzd weakness it also resulted in a relatively steep retreat in bond yields. Nzd/Usd is now testing new y-t-d lows around 0.7025 ahead of trade data, while Aud/Usd is holding above its 2021 trough circa 0.7621 and 0.7650 in advance of PMIs.

  • DXY - The demise of its Antipodean rivals may have provided the Greenback with traction and a solid overnight platform to build on, but the subsequent rebound has been much more broad-based with only the Yen evading the Dollar’s clutches in G10 land and Lira putting up some resistance alongside the Yuan on the EM front. Moreover, the index gathered more momentum and bullish technical impetus once 92.000 was breached as counterparts lost psychological and key chart levels and the DXY is now just shy of 92.155 vs 91.753 at worst in the run up to a raft of Fed speakers, more US housing data and the start of this week’s auction schedule in the form of Usd 60 bn 2 year notes.
  • CHF/GBP - Little surprise to see Monday’s outperformer concede quite a lot of ground to the bouncing Buck, as the Franc retreats abruptly from another test of 0.9250+ terrain towards 0.9300 and to 1.1050 or so against the Euro from not far off 1.1000 at one stage. Similarly, Sterling has lost more momentum approaching 1.3900 and pulled back through the 50 DMA at 1.3830 before losing 1.3800+ status altogether and is now looking even more prone around the 1.3760 pivot point that prefaced Cable’s rally, while Eur/Gbp is back in the ascendency after a fleeting test of underlying bids/support around 0.8600, with the deriving little if anything from mixed UK labour and wage data.
  • CAD/EUR- Also recoiling vs their US peer, with the Loonie struggling to stay afloat of the 1.2600 handle against the backdrop of collapsing crude prices and awaiting comments from BoC’s Gravelle for any independent impetus, while the Euro is striving to stay within sight of 1.1900 and stop the rot before getting too close to the 200 DMA (1.1860).
  • JPY - As noted above, the Yen is bucking the overall trend and revisiting peaks beyond 108.50 vs the Greenback on a wave of pre-month end buying, but also benefiting from the fact that US Treasuries are rebounding and the curve re-flattening post-Tuesday’s official JGB close. However, decent option expiry interest at the 108.00 strike (2 BN) and just above may underpin Usd/Jpy.

In commodities, WTI and Brent front month futures have started the session on a markedly softer footing and have been selling off throughout the European morning. Currently, WTI trades below USD 59.00/bbl (vs high USD 61.35/bbl) and Brent trades mid USD 61.00/bbl (vs high USD 64.30/bbl), ahead of last week’s lows around USD 58.30/bbl and USD 61.50/bbl respectively. Additionally, the Brent May and April curve has flipped into contango for the first time since January. Moreover, the softer sentiment seen could largely be down to the slow vaccine rollouts and increasing COVID infection rates across large Eurozone economies. Consequently, it has led to new pandemic measures which can be in illustrated in Germany, Europe’s biggest oil consumer, who announced over Easter (April 1st to April 5th) people should stay at home and only food shops will be open. This also comes as France observes its respective lockdown whilst reports via UK press suggested that international travel could be affected, although the UK government later poured cold water on this. Elsewhere, Saudi Arabia is proposing a peace initiative to the Houthis to end the Yemen war, which would include a nationwide ceasefire. This could potentially be of interest as it may put the Saudi Aramco facility at ease and reduce the likelihood of it getting targeted in the interim. In terms of bank commentary, Barclays expects US crude oil output to grow by 600k BPD Q4 2020 to Q4 2021 and be priced at USD 62/bbl, whilst for 2022 output is seen growing 800k BPD and WTI trading at USD 68/bbl. For Brent, Barclays forecasts prices at 66/bbl and USD 71/bbl for 2021 and 2022 respectively. Today’s notable risk events include Fed’s Powell & weekly private inventory data, although market sentiment, lockdown/virus developments are likely to hold the narrative. Onto precious metals, spot gold has traded choppily and currently resides in marginally firmer territory whereas silver has seen pronounced downside all morning, which could be tied into the Dollar upside. XAU trades just above USD 1,740/oz (vs low USD 1,731/oz) and XAG is marginally above USD 25.50/oz (vs high USD 25.81/oz). Moving onto base metals, LME copper follows the general sentiment and is softer whilst trading just above USD 9,000/t at the time of writing. Overnight, the most-actively-traded Shanghai aluminium futures hit limit-down and its lowest level in a month amid reports China is contemplating over whether to sell aluminium state reserves to cool prices. Dalian coke futures fell for a third straight session potentially due to the weak demand, and in tangent with the steel mills in Shanxi and Hebei lowering their buying prices because of plentiful stocks.

US Event Calendar

  • 8:30am: 4Q Current Account Balance, est. -$188b, prior - $178.5b
  • 10am: March Richmond Fed Index, est. 16, prior 14
  • 10am: Feb. New Home Sales MoM, est. -5.7%, prior 4.3%
  • 10am: Feb. New Home Sales, est. 870,000, prior 923,000

Central Banks

  • 9am: Fed’s Bullard Discusses Economy at LSE Event
  • 10:10am: Fed’s Bostic Discusses Economic Inclusivity
  • 11am: Fed’s Barkin Takes Part in Virtual Discussion
  • 12pm: Powell, Yellen Appear Before House Panel on CARES Act
  • 1:30pm: Fed’s Brainard Gives Speech on Climate Change
  • 2:45pm: Fed’s Williams Takes Part in Virtual Discussion
  • 3:45pm: Fed’s Brainard Discusses Economic Outlook
  • 4:20pm: Fed’s Bullard Takes Part in Discussion at NABE

DB's Jim Reid concludes the overnight wrap

Markets drove it straight down the middle yesterday and got the week off to a strong start on the whole as lower sovereign bond yields proved supportive for global equities. Not even Turkey struggling deep in the rough was enough to derail the day. In fact, markets had generally erased the previous week’s moves surrounding the Fed meeting by yesterday’s close, with yields on 10yr US Treasuries down -2.6bps to 1.695%, which puts them only slightly above where they’d been prior to the Fed’s decision last week, and well below the intraday high of 1.753% reached last Thursday. Over in equity markets it was a similar story, with the S&P 500 up +0.70% to nearly reverse the previous week’s declines. Unsurprisingly given the fixed income moves, it was tech stocks that led the way, as the NASDAQ (+1.23%) and the NYSE FANG+ (+1.32%) both recorded strong performances. Predictably financials suffered at the other end of the spectrum with the S&P 500 Banks group shedding -2.27%. Energy stocks, the other cyclical darling of recent weeks, fell back -1.01% even as oil prices moderated following last week’s large loss.

Looking at the moves in more depth, the declines in Treasury yields were concentrated at the long end of the curve, with 30yr yields down -3.5bps, whereas 2yr yields were down just -0.2bps, though they were actually up for the majority of the day. Furthermore, it was lower real rates rather than inflation expectations that drove the moves, with 10yr real yields down -4.1bps and breakevens up +1.5bps. In fact, long-term inflation expectations recorded fresh milestones yesterday, with 30yr breakevens up another +1.9bps to 2.294%, reaching levels not seen since 2014.

Over in Europe there was also a move lower in yields, with those on 10yr bunds (-1.7bps), OATs (-1.3bps) and BTPs (-1.7bps) all falling slightly. That came as data showed the ECB’s net purchases under their Pandemic Emergency Purchase Programme (PEPP) rose to €21.1bn in the week to March 19, which was the fastest pace since December, though we won’t get the gross number until today. It was broadly in line with what was expected. Equity markets were more subdued than their US counterparts however, with the STOXX 600 (+0.19%) and the DAX (+0.25%) both seeing modest rises. The big continental loser yesterday was Spain’s IBEX 35 (-1.76%), which was hurt by BBVA’s decline (-7.72%) as a result of its exposure to Turkey.

Markets in Asia are trading lower though with the Nikkei (-0.39%), Hang Seng (-1.34%), Shanghai Comp (-1.18%) and Kospi (-0.93%) all declining. The underperformance of Chinese bourses is likely due to the US, UK and Canada joining the EU to impose sanctions on the country over alleged human rights abuses on the Uyghurs in Xinjiang. Futures on the S&P 500 are down -0.19% while those on the Nasdaq are down a greater -0.35%. European ones are pointing to a weaker open too. Sovereign yields continue to soften with those on 10y USTs down -2.6bps to 1.671% driven by a decline in 10y real yields. Australia (-2.8bps) and New Zealand’s (-6.5bps) 10y yields are also trading softer. In Fx, the New Zealand dollar is -1.12% lower after the government took steps to arrest a bubble in housing such as removing tax incentives for property investors and unlocking more land to increase supply. Elsewhere WTI and Brent crude oil prices are also down -1% this morning.

In other news, US Treasury secretary Yellen emphasised in her prepared remarks that encouraging economic data shouldn’t distract from the progress still to be made while Fed Chair Powell reaffirmed that the Fed will continue to support the US economy for as long as it takes, in a speech for his accompanying appearance. These remarks will be part of their appearance before the House Financial Services Committee later today. So soon after the FOMC there are unlikely to be any major surprises. Meanwhile, Bloomberg has reported that the BoJ’s plan to stop buying the Nikkei 225 ETF won’t take effect until the start of next month as this will allow the central bank and trust banks it employs to make the necessary preparations for the adjusted buying program. Elsewhere, Bloomberg reported that Microsoft is in talks to acquire Discord Inc., a video-game chat community, for more than $10bn.

On the pandemic, the news came through just after we hit your inboxes yesterday that the AstraZeneca vaccine was 79% effective in a US trial at preventing symptomatic Covid cases, and 100% effective at preventing severe disease and hospitalisation. Furthermore, among the over-65s, the efficacy was 80%, and in a specific review of thrombotic events, no increased risk was found among the 21,583 participants who received at least one dose in the trial. AstraZeneca said that they planned to submit their data and analysis to the US FDA, in order to obtain an Emergency Use Authorization “in the coming weeks”. However, overnight the National Institute of Allergy and Infectious Diseases has said in a statement that the Data and Safety Monitoring Board has expressed concern that AstraZeneca may have included outdated information from the trial, which provided an incomplete view of efficacy data. The NIAID statement further added that the body urges AZ to work with DSMB to review efficacy of the data and ensure the most accurate, up-to-date data be made public as quickly as possible.

Staying on the pandemic, Germany extended its lockdown a further 4 weeks taking it to April 18, while nearby Austria cancelled its reopening plans, which were scheduled to start just after Easter. Overnight Bloomberg has reported that Germany will go into a hard lockdown for 5 days from April 1 (over Easter) to help reverse a “third wave” of Covid-19 infections. Under the hard lockdown plan, all stores will be shuttered for the five days, except for food stores which will open on April 3. Citizens will be encouraged to remain at home while private gatherings will be limited to one other household and a maximum of five people, and public meetings banned.

Meanwhile, the question of whether the EU would impose export controls on the AstraZeneca vaccine remained in the headlines, ahead of the EU leaders’ summit on Thursday and Friday. In the UK however, Prime Minister Johnson struck an emollient tone, saying that "I am reassured by talking to EU partners over the last few months that they don't want to see blockades." Nevertheless, it was confirmed that Johnson had spoken to President Macron and Chancellor Merkel on Sunday regarding the issue, which threaten to increase tensions further between the two sides if imposed, and could lead to retaliatory measures by the UK side. Notably however, there doesn’t seem to be unanimity within the EU on the merits of vaccine controls, with Irish Prime Minister Martin saying yesterday in an RTE interview that they’d be a “retrograde step” and “counterproductive”. There was some good news late last night as Bloomberg reported that EU leaders were in negotiations with the UK to share the output from a Dutch AZ plant. Meanwhile the US continues its vaccine programmes, with more states lowering eligibility ages in an effort to get the population vaccinated quickly in an efficient manner. NY state lowered the age to 50 and over, while Arizona lowered it all the way down to 16.

There wasn’t a great deal in the way of data yesterday, though existing home sales in the US fell to a 6-month low, down at an annualised rate of 6.22m in February (vs. 6.49m expected). In addition, the Chicago Fed’s national activity index fell to -1.09 (vs. 0.72 expected), marking the first decline since April last year.

To the day ahead now, and the main highlight will likely be the appearance of Fed Chair Powell and US Treasury Secretary Yellen before the House Financial Services Committee. Other central bank speakers include the Fed’s Bullard, Bostic, Barkin, Brainard and Williams, as well as BoE Governor Bailey, Deputy Governor Cunliffe and Chief Economist Haldane, along with the ECB’s Villeroy. Data highlights from the US include February’s new home sales and March’s Richmond Fed manufacturing index. Meanwhile the UK will be reporting its employment data for January. Finally, today sees parliamentary elections taking place in Israel.

Tyler Durden Tue, 03/23/2021 - 07:57

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Are Voters Recoiling Against Disorder?

Are Voters Recoiling Against Disorder?

Authored by Michael Barone via The Epoch Times (emphasis ours),

The headlines coming out of the Super…

Published

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Are Voters Recoiling Against Disorder?

Authored by Michael Barone via The Epoch Times (emphasis ours),

The headlines coming out of the Super Tuesday primaries have got it right. Barring cataclysmic changes, Donald Trump and Joe Biden will be the Republican and Democratic nominees for president in 2024.

(Left) President Joe Biden delivers remarks on canceling student debt at Culver City Julian Dixon Library in Culver City, Calif., on Feb. 21, 2024. (Right) Republican presidential candidate and former U.S. President Donald Trump stands on stage during a campaign event at Big League Dreams Las Vegas in Las Vegas, Nev., on Jan. 27, 2024. (Mario Tama/Getty Images; David Becker/Getty Images)

With Nikki Haley’s withdrawal, there will be no more significantly contested primaries or caucuses—the earliest both parties’ races have been over since something like the current primary-dominated system was put in place in 1972.

The primary results have spotlighted some of both nominees’ weaknesses.

Donald Trump lost high-income, high-educated constituencies, including the entire metro area—aka the Swamp. Many but by no means all Haley votes there were cast by Biden Democrats. Mr. Trump can’t afford to lose too many of the others in target states like Pennsylvania and Michigan.

Majorities and large minorities of voters in overwhelmingly Latino counties in Texas’s Rio Grande Valley and some in Houston voted against Joe Biden, and even more against Senate nominee Rep. Colin Allred (D-Texas).

Returns from Hispanic precincts in New Hampshire and Massachusetts show the same thing. Mr. Biden can’t afford to lose too many Latino votes in target states like Arizona and Georgia.

When Mr. Trump rode down that escalator in 2015, commentators assumed he’d repel Latinos. Instead, Latino voters nationally, and especially the closest eyewitnesses of Biden’s open-border policy, have been trending heavily Republican.

High-income liberal Democrats may sport lawn signs proclaiming, “In this house, we believe ... no human is illegal.” The logical consequence of that belief is an open border. But modest-income folks in border counties know that flows of illegal immigrants result in disorder, disease, and crime.

There is plenty of impatience with increased disorder in election returns below the presidential level. Consider Los Angeles County, America’s largest county, with nearly 10 million people, more people than 40 of the 50 states. It voted 71 percent for Mr. Biden in 2020.

Current returns show county District Attorney George Gascon winning only 21 percent of the vote in the nonpartisan primary. He’ll apparently face Republican Nathan Hochman, a critic of his liberal policies, in November.

Gascon, elected after the May 2020 death of counterfeit-passing suspect George Floyd in Minneapolis, is one of many county prosecutors supported by billionaire George Soros. His policies include not charging juveniles as adults, not seeking higher penalties for gang membership or use of firearms, and bringing fewer misdemeanor cases.

The predictable result has been increased car thefts, burglaries, and personal robberies. Some 120 assistant district attorneys have left the office, and there’s a backlog of 10,000 unprosecuted cases.

More than a dozen other Soros-backed and similarly liberal prosecutors have faced strong opposition or have left office.

St. Louis prosecutor Kim Gardner resigned last May amid lawsuits seeking her removal, Milwaukee’s John Chisholm retired in January, and Baltimore’s Marilyn Mosby was defeated in July 2022 and convicted of perjury in September 2023. Last November, Loudoun County, Virginia, voters (62 percent Biden) ousted liberal Buta Biberaj, who declined to prosecute a transgender student for assault, and in June 2022 voters in San Francisco (85 percent Biden) recalled famed radical Chesa Boudin.

Similarly, this Tuesday, voters in San Francisco passed ballot measures strengthening police powers and requiring treatment of drug-addicted welfare recipients.

In retrospect, it appears the Floyd video, appearing after three months of COVID-19 confinement, sparked a frenzied, even crazed reaction, especially among the highly educated and articulate. One fatal incident was seen as proof that America’s “systemic racism” was worse than ever and that police forces should be defunded and perhaps abolished.

2020 was “the year America went crazy,” I wrote in January 2021, a year in which police funding was actually cut by Democrats in New York, Los Angeles, San Francisco, Seattle, and Denver. A year in which young New York Times (NYT) staffers claimed they were endangered by the publication of Sen. Tom Cotton’s (R-Ark.) opinion article advocating calling in military forces if necessary to stop rioting, as had been done in Detroit in 1967 and Los Angeles in 1992. A craven NYT publisher even fired the editorial page editor for running the article.

Evidence of visible and tangible discontent with increasing violence and its consequences—barren and locked shelves in Manhattan chain drugstores, skyrocketing carjackings in Washington, D.C.—is as unmistakable in polls and election results as it is in daily life in large metropolitan areas. Maybe 2024 will turn out to be the year even liberal America stopped acting crazy.

Chaos and disorder work against incumbents, as they did in 1968 when Democrats saw their party’s popular vote fall from 61 percent to 43 percent.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times or ZeroHedge.

Tyler Durden Sat, 03/09/2024 - 23:20

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Veterans Affairs Kept COVID-19 Vaccine Mandate In Place Without Evidence

Veterans Affairs Kept COVID-19 Vaccine Mandate In Place Without Evidence

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

The…

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Veterans Affairs Kept COVID-19 Vaccine Mandate In Place Without Evidence

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

The U.S. Department of Veterans Affairs (VA) reviewed no data when deciding in 2023 to keep its COVID-19 vaccine mandate in place.

Doses of a COVID-19 vaccine in Washington in a file image. (Jacquelyn Martin/Pool/AFP via Getty Images)

VA Secretary Denis McDonough said on May 1, 2023, that the end of many other federal mandates “will not impact current policies at the Department of Veterans Affairs.”

He said the mandate was remaining for VA health care personnel “to ensure the safety of veterans and our colleagues.”

Mr. McDonough did not cite any studies or other data. A VA spokesperson declined to provide any data that was reviewed when deciding not to rescind the mandate. The Epoch Times submitted a Freedom of Information Act for “all documents outlining which data was relied upon when establishing the mandate when deciding to keep the mandate in place.”

The agency searched for such data and did not find any.

The VA does not even attempt to justify its policies with science, because it can’t,” Leslie Manookian, president and founder of the Health Freedom Defense Fund, told The Epoch Times.

“The VA just trusts that the process and cost of challenging its unfounded policies is so onerous, most people are dissuaded from even trying,” she added.

The VA’s mandate remains in place to this day.

The VA’s website claims that vaccines “help protect you from getting severe illness” and “offer good protection against most COVID-19 variants,” pointing in part to observational data from the U.S. Centers for Disease Control and Prevention (CDC) that estimate the vaccines provide poor protection against symptomatic infection and transient shielding against hospitalization.

There have also been increasing concerns among outside scientists about confirmed side effects like heart inflammation—the VA hid a safety signal it detected for the inflammation—and possible side effects such as tinnitus, which shift the benefit-risk calculus.

President Joe Biden imposed a slate of COVID-19 vaccine mandates in 2021. The VA was the first federal agency to implement a mandate.

President Biden rescinded the mandates in May 2023, citing a drop in COVID-19 cases and hospitalizations. His administration maintains the choice to require vaccines was the right one and saved lives.

“Our administration’s vaccination requirements helped ensure the safety of workers in critical workforces including those in the healthcare and education sectors, protecting themselves and the populations they serve, and strengthening their ability to provide services without disruptions to operations,” the White House said.

Some experts said requiring vaccination meant many younger people were forced to get a vaccine despite the risks potentially outweighing the benefits, leaving fewer doses for older adults.

By mandating the vaccines to younger people and those with natural immunity from having had COVID, older people in the U.S. and other countries did not have access to them, and many people might have died because of that,” Martin Kulldorff, a professor of medicine on leave from Harvard Medical School, told The Epoch Times previously.

The VA was one of just a handful of agencies to keep its mandate in place following the removal of many federal mandates.

“At this time, the vaccine requirement will remain in effect for VA health care personnel, including VA psychologists, pharmacists, social workers, nursing assistants, physical therapists, respiratory therapists, peer specialists, medical support assistants, engineers, housekeepers, and other clinical, administrative, and infrastructure support employees,” Mr. McDonough wrote to VA employees at the time.

This also includes VA volunteers and contractors. Effectively, this means that any Veterans Health Administration (VHA) employee, volunteer, or contractor who works in VHA facilities, visits VHA facilities, or provides direct care to those we serve will still be subject to the vaccine requirement at this time,” he said. “We continue to monitor and discuss this requirement, and we will provide more information about the vaccination requirements for VA health care employees soon. As always, we will process requests for vaccination exceptions in accordance with applicable laws, regulations, and policies.”

The version of the shots cleared in the fall of 2022, and available through the fall of 2023, did not have any clinical trial data supporting them.

A new version was approved in the fall of 2023 because there were indications that the shots not only offered temporary protection but also that the level of protection was lower than what was observed during earlier stages of the pandemic.

Ms. Manookian, whose group has challenged several of the federal mandates, said that the mandate “illustrates the dangers of the administrative state and how these federal agencies have become a law unto themselves.”

Tyler Durden Sat, 03/09/2024 - 22:10

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The Coming Of The Police State In America

The Coming Of The Police State In America

Authored by Jeffrey Tucker via The Epoch Times,

The National Guard and the State Police are now…

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The Coming Of The Police State In America

Authored by Jeffrey Tucker via The Epoch Times,

The National Guard and the State Police are now patrolling the New York City subway system in an attempt to do something about the explosion of crime. As part of this, there are bag checks and new surveillance of all passengers. No legislation, no debate, just an edict from the mayor.

Many citizens who rely on this system for transportation might welcome this. It’s a city of strict gun control, and no one knows for sure if they have the right to defend themselves. Merchants have been harassed and even arrested for trying to stop looting and pillaging in their own shops.

The message has been sent: Only the police can do this job. Whether they do it or not is another matter.

Things on the subway system have gotten crazy. If you know it well, you can manage to travel safely, but visitors to the city who take the wrong train at the wrong time are taking grave risks.

In actual fact, it’s guaranteed that this will only end in confiscating knives and other things that people carry in order to protect themselves while leaving the actual criminals even more free to prey on citizens.

The law-abiding will suffer and the criminals will grow more numerous. It will not end well.

When you step back from the details, what we have is the dawning of a genuine police state in the United States. It only starts in New York City. Where is the Guard going to be deployed next? Anywhere is possible.

If the crime is bad enough, citizens will welcome it. It must have been this way in most times and places that when the police state arrives, the people cheer.

We will all have our own stories of how this came to be. Some might begin with the passage of the Patriot Act and the establishment of the Department of Homeland Security in 2001. Some will focus on gun control and the taking away of citizens’ rights to defend themselves.

My own version of events is closer in time. It began four years ago this month with lockdowns. That’s what shattered the capacity of civil society to function in the United States. Everything that has happened since follows like one domino tumbling after another.

It goes like this:

1) lockdown,

2) loss of moral compass and spreading of loneliness and nihilism,

3) rioting resulting from citizen frustration, 4) police absent because of ideological hectoring,

5) a rise in uncontrolled immigration/refugees,

6) an epidemic of ill health from substance abuse and otherwise,

7) businesses flee the city

8) cities fall into decay, and that results in

9) more surveillance and police state.

The 10th stage is the sacking of liberty and civilization itself.

It doesn’t fall out this way at every point in history, but this seems like a solid outline of what happened in this case. Four years is a very short period of time to see all of this unfold. But it is a fact that New York City was more-or-less civilized only four years ago. No one could have predicted that it would come to this so quickly.

But once the lockdowns happened, all bets were off. Here we had a policy that most directly trampled on all freedoms that we had taken for granted. Schools, businesses, and churches were slammed shut, with various levels of enforcement. The entire workforce was divided between essential and nonessential, and there was widespread confusion about who precisely was in charge of designating and enforcing this.

It felt like martial law at the time, as if all normal civilian law had been displaced by something else. That something had to do with public health, but there was clearly more going on, because suddenly our social media posts were censored and we were being asked to do things that made no sense, such as mask up for a virus that evaded mask protection and walk in only one direction in grocery aisles.

Vast amounts of the white-collar workforce stayed home—and their kids, too—until it became too much to bear. The city became a ghost town. Most U.S. cities were the same.

As the months of disaster rolled on, the captives were let out of their houses for the summer in order to protest racism but no other reason. As a way of excusing this, the same public health authorities said that racism was a virus as bad as COVID-19, so therefore it was permitted.

The protests had turned to riots in many cities, and the police were being defunded and discouraged to do anything about the problem. Citizens watched in horror as downtowns burned and drug-crazed freaks took over whole sections of cities. It was like every standard of decency had been zapped out of an entire swath of the population.

Meanwhile, large checks were arriving in people’s bank accounts, defying every normal economic expectation. How could people not be working and get their bank accounts more flush with cash than ever? There was a new law that didn’t even require that people pay rent. How weird was that? Even student loans didn’t need to be paid.

By the fall, recess from lockdown was over and everyone was told to go home again. But this time they had a job to do: They were supposed to vote. Not at the polling places, because going there would only spread germs, or so the media said. When the voting results finally came in, it was the absentee ballots that swung the election in favor of the opposition party that actually wanted more lockdowns and eventually pushed vaccine mandates on the whole population.

The new party in control took note of the large population movements out of cities and states that they controlled. This would have a large effect on voting patterns in the future. But they had a plan. They would open the borders to millions of people in the guise of caring for refugees. These new warm bodies would become voters in time and certainly count on the census when it came time to reapportion political power.

Meanwhile, the native population had begun to swim in ill health from substance abuse, widespread depression, and demoralization, plus vaccine injury. This increased dependency on the very institutions that had caused the problem in the first place: the medical/scientific establishment.

The rise of crime drove the small businesses out of the city. They had barely survived the lockdowns, but they certainly could not survive the crime epidemic. This undermined the tax base of the city and allowed the criminals to take further control.

The same cities became sanctuaries for the waves of migrants sacking the country, and partisan mayors actually used tax dollars to house these invaders in high-end hotels in the name of having compassion for the stranger. Citizens were pushed out to make way for rampaging migrant hordes, as incredible as this seems.

But with that, of course, crime rose ever further, inciting citizen anger and providing a pretext to bring in the police state in the form of the National Guard, now tasked with cracking down on crime in the transportation system.

What’s the next step? It’s probably already here: mass surveillance and censorship, plus ever-expanding police power. This will be accompanied by further population movements, as those with the means to do so flee the city and even the country and leave it for everyone else to suffer.

As I tell the story, all of this seems inevitable. It is not. It could have been stopped at any point. A wise and prudent political leadership could have admitted the error from the beginning and called on the country to rediscover freedom, decency, and the difference between right and wrong. But ego and pride stopped that from happening, and we are left with the consequences.

The government grows ever bigger and civil society ever less capable of managing itself in large urban centers. Disaster is unfolding in real time, mitigated only by a rising stock market and a financial system that has yet to fall apart completely.

Are we at the middle stages of total collapse, or at the point where the population and people in leadership positions wise up and decide to put an end to the downward slide? It’s hard to know. But this much we do know: There is a growing pocket of resistance out there that is fed up and refuses to sit by and watch this great country be sacked and taken over by everything it was set up to prevent.

Tyler Durden Sat, 03/09/2024 - 16:20

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