KristalDaily - Jan 13

US CPI yesterday was mostly in line with expectations - headline number was 7% YoY but the MoM increase was marginally lower than expected as energy prices dipped. US yields moved higher on the day with the 10Y stuck in the 1.7-1.8% range now.

From a technical viewpoint, if it is able to break above 1.8% level conclusively, then it would likely run up to the 2% mark fairly soon. This level have proved elusive over the last couple of years since the pandemic hit. The 2Y yield moved closer to the 1% mark as well as the fourth hike for 2022 is getting priced in.

Inflation eased off in China earlier in the day but readings from India showed it pushing towards the higher end of RBI's range, ahead of key state elections.

SPX posted another small gain on the day with the Materials sector leading the way. It was a broadly positive day for equities across the globe. Energy was relatively quiet despite gains in Crude and Natural Gas - the latter moved another leg higher without any obvious trigger around the Ukraine situation.

Crypto was supported and the US dollar gained alongside US yields. Ahead today, we have weekly unemployment numbers in the US and also kick off the first earnings season of the new year with JPM and other banks first on the docket.

Expectations are high with the tilt towards value and hawkish central banks are likely to keep rates elevated in the near term.

"I'd rather see someone with a gambling tendency go to Las Vegas and drop $200 than betting on pork bellies, the silver market or new issues market. You shouldn't speculate except with money you can afford to lose"