US open: Stocks mixed with Ukraine peace talks, Fed in focus

US futures

Dow futures +0.5% at 33100

S&P futures +0.2% at 4212

Nasdaq futures -0.35% at 13255

In Europe

FTSE +0.3% at 7170

Dax +1.4% at 13860

Euro Stoxx +1% at 3726

Learn more about trading indices

Nasdaq underperforms as yields rise

US stocks are set for a mixed start as Russian Ukraine peace talks resume and investors look ahead to the Federal Reserve monetary policy meeting.

More peace talks are taking place today. Hopes are growing that a diplomatic solution can be found. US Deputy Secretary of State Wendy Sherman said that Russia shows signs of wanting to progress negotiations.

The positive comment combined with the most optimistic assessments so far from both Ukraine and Russia over the state of talks is helping boost risk sentiment, lifting stocks cautiously higher after heavy losses last week. Oil prices are also heading lower.

The Nasdaq is underperforming its peers as attention also turns to the Federal Reserve rate decision later in the week. The Fed is expected to hike rates by 0.25% after inflation surged to 7.9% YoY in February.

In addition to Ukraine Russia talks, the US and China are also set to hold their first high-level talks since Russia’s invasion last month and amid reports that Russia asked China for military equipment at the start of its invasion.

Separately, China has seen COVID cases jump to a two-year high. The tech hub Shenzhen has been moved back into lockdown. While the Chinese stock market was hit on the news, in Europe and the US, Ukraine optimism overshadows the rapid spread of Omicron in the world’s second-largest economy.

There is no high-impacting US data due to be released today.

Where next for the Nasdaq?

The Nasdaq is edging lower on the day after failing to find acceptance at 13450. The long wick on the candle, combined with the bearish RSI, suggests that there could be more downside on the cards. Strong support can be seen at 13000 the round number and 2022 low. A break below here would be significant and open the door to 12200 the March 2021 low. Buyers will look for a move over 13850, the confluence of the falling trendline resistance and last week’s high ahead of 14000 round number and 14415, which is a move above here, changing the bias to bullish.

FX markets USD falls, EUR rises

USD is heading lower as risk sentiment returns. That said, any losses in the greenback could be capped by rising treasury yields ahead of Wednesday’s Fed rate decision.

EURUSD is rising, boosted by hopes of a diplomatic end to the Ukraine war, bringing 1.10 psychological level back into focus. Europe stands to gain the most from a quick resolution to the Ukraine crisis.

GBPUSD is falling despite the improved market mood. While it has picked up from the year-to-date low of 1.30, the price remains depressed. The BoE rate decision is due on Thursday, and expectations are for a rate hike back to pre-covid levels. However, growth is also set to slow, which is unnerving investors.

GBP/USD -0.1% at 1.3029

EUR/USD +0.38% at 1.0955

Oil tanks 5%

Oil prices fell 5% across last week and trade 5% lower just today as investors grew hopeful of diplomatic efforts to end the Ukraine crisis and COVID cases surge in China.

Russian and Ukraine negotiators are due to sit down again today for more peace talks after an upbeat assessment of weekend developments, at least round the table; fighting on the ground continues. Meanwhile, Russian exports will be closely monitored for signs of changes.

In addition to Ukraine hopes, a jump in COVID cases in China and strict new lockdown restrictions raise questions over the demand outlook. New daily infections have hit a two-year high in China, the world’s largest oil importer.

WTI crude trades -4.6% at $101.80

Brent trades +4.6% at $105.88

Learn more about trading oil here.

Looking ahead

N/A

How to trade with City Index

Follow these easy steps to start trading with City Index today:

Open a City Index account, or log-in if you’re already a customer.
Search for the market you want to trade in our award-winning platform.
Choose your position and size, and your stop and limit levels
Place the trade.

From time to time, StoneX Financial Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.

City Index is a trading name of StoneX Financial Pty Ltd.

The material provided herein is general in nature and does not take into account your objectives, financial situation or needs.

While every care has been taken in preparing this material, we do not provide any representation or warranty (express or implied) with respect to its completeness or accuracy. This is not an invitation or an offer to invest nor is it a recommendation to buy or sell investments.

StoneX recommends you to seek independent financial and legal advice before making any financial investment decision. Trading CFDs and FX on margin carries a higher level of risk, and may not be suitable for all investors. The possibility exists that you could lose more than your initial investment further CFD investors do not own or have any rights to the underlying assets.

It is important you consider our Financial Services Guide and Product Disclosure Statement (PDS) available at www.cityindex.com/en-au/terms-and-policies/, before deciding to acquire or hold our products. As a part of our market risk management, we may take the opposite side of your trade. Our Target Market Determination (TMD) is also available at www.cityindex.com/en-au/terms-and-policies/.

StoneX Financial Pty Ltd, Suite 28.01, 264 George Street, Sydney, NSW 2000 (ACN 141 774 727, AFSL 345646) is the CFD issuer and our products are traded off exchange.