Equity markets were mixed overnight, with the DOW continuing to test record highs, while the tech heavy NASQDAQ contracted sharply. The move came as more of a realignment, but may be an indicator of what is to come, ahead of the Fed minutes. The Fed minutes are expected to discuss the, QE transition to QT program and the course for interest rate rises, foreshadowed. The other point of interest will be the forecasts of growth and inflation, which may ring some alarm bells in the markets.
The ADP Private Sector jobs report, is an important indicator to the Non-Farm Payrolls number, to be released Friday. The ADP showed an additional 800,000 jobs, which is almost double expectations, which augers well. Services and PMI data in the US was flat, as it was in the EU, although German data turned sharply negative. This can be associated with the draconian restrictions and regulations, imposed upon the German population, to combat the latest omicron viral mutation.
The US 10 Year Bond continued to spike, breaking above 1.7%, but failing to support the US Dollar. The EUR jumped back above 1.1300, while the GBP charges towards 1.3600. Commodity demand was high, which quickly spread to the associated currencies. The softer reserve was also a boost, with the NZD braking back above 0.6800, while the AUD pushed up to 0.7250.
All eyes on the Fed minutes and the Non Farm Payrolls.