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This week may be one that offers more noise than signal and the Archegos Capital news will likely add to that. The heavy selling in Viacom last week did little to hurt markets in general but suddenly it “matters” in early trading today so far.
In essence, it plays to anxiety and fears as typically when something goes wrong in the market, there is the thinking that ‘there is never just one rotten egg in a bad bunch’.
But with month-end and quarter-end flows set to be a focal point this week, all of that may very well just end up adding to the noise over the next few days.
The yen is leading gains in the major currencies space with the dollar also seen holding steadier, as commodity currencies lag behind slightly.
US futures are weighed down to the lows for the day, with Nasdaq futures sliding 1%. Elsewhere, oil prices dropping as the Ever Given is being refloated in the Suez Canal is hurting the loonie a little more as well.
Treasury yields are coming off the highs at the end of last week, with 10-year yields down 3 bps to 1.645% today. Part of that may be reflected in the more risk averse tone in the market but we’ll see if that keeps up ahead of US trading later.
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