By Lorcan Roche Kelly
Super Joe
Joe Biden staged a remarkable comeback in yesterday’s Super Tuesday primaries, upending the odds to win in both Texas and Massachusetts. He is now expected to be close to a dead heat for the nomination with Bernie Sanders, who won California. There appear to be some signs of party supporters coalescing around Biden as he won votes from across the spectrum. Neither Senator Elizabeth Warren nor Michael Bloomberg made much headway, with Warren coming third in her home state, and Bloomberg only managing to secure victory in American Samoa. (Bloomberg is the founder and majority owner of Bloomberg LP, the parent company of Bloomberg News.)
Travel restrictions
The list of events under threat from the coronavirus outbreak continues to grow as more and more companies impose travel restrictions. Japan’s Olympic minister said it would be possible to delay the event until later in the year, while the European Central Bank has become the latest major institution to ban all but essential travel. The global death toll now stands at over 3,200, with nine fatalities in the U.S. Transportation Security Administration chief David Pekoske said he expected there to be more curbs on movement announced soon.
Bond rush
Yesterday’s 50 basis-point rate cut from the Federal Reserve saw the rally in Treasuries gain pace, with the yield on the 10-year instrument dropping below 1% for the first time ever. Similar moves were seen in sovereign debt across the world as investors bet on more central bank action in the coming weeks. Markets are assigning a 100% chance that the Bank of Canada will cut rates by at least 0.25 percentage point at today’s scheduled meeting. The other big winner from the moves is gold, which has rallied $50 an ounce in the past two days.
Markets rise
Equity investors are more bullish today, with Joe Biden’s improving chances of gaining the Democratic nomination helping sentiment. Overnight, the MSCI Asia Pacific Index added 0.3% while Japan’s Topix index closed 0.2% lower. In Europe, the Stoxx 600 Index was 1.4% higher at 5:45 a.m. Eastern Time with every sector posting gains. S&P 500 futures pointed to a very strong open and the 10-year Treasury yield was at 0.949%.
Coming up…
With everything else going on you might be forgiven for forgetting there is payrolls data on Friday. ADP is along with a reminder at 8:15 a.m., when it publishes the unemployment change number. Markit services and composite PMIs for February are at 9:45 a.m., with ISM non-manufacturing at 10:00 a.m. The Bank of Canada’s rate decision is also at 10:00 a.m. While the oil market may be concentrating on the OPEC+ technical meeting in Vienna today, there should be some interest in inventories data at 10:30 a.m. The Fed’s beige book is due at 2:00 p.m. Campbell Soup Co., Abercrombie & Fitch Co. and Dollar Tree Inc. are among the companies reporting earnings.
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