Market Drivers – US Session – 17 Feb.

Thursday’s asset trading closed largely negatively with a significant decline in risk appetite because tensions in Eastern Europe that have come back to the news headlines.

Risk assets, first and foremost stocks and the euro, declined as yields of US Treasury bonds fell in favour of higher safe haven assets, most notably the US dollar, the Japanese yen and gold.

The Gold Index (XAU/USD) hit $1900 per ounce for the first time since June 2021 on Thursday, taking its on-the-day gains to more than 1.5% as geopolitical tensions between Russia, Ukraine and NATO simmer, stimulating demand for safe-haven assets.

Gold now trades more than 2.0% higher on the week, taking its two-week run of gains to nearly 5.0%. Fears of an imminent Russian military incursion into Ukraine have escalated in recent days.

Economic data

Data published by the United States Department of Labour, Thursday revealed that there were 24800 initial jobless claims in the United States during the week ending 12 February.

The latest reading is higher than estimates of 2190000 initial claims and also higher than last week’s reading of 2250000, which was adjusted upward from 2230000.

Other developments
Russia expelled the deputy head of the United States diplomatic mission to Moscow, Bart Gorman, Thursday, per US State Department’s statement, which considers this move “unjustified.”

In return, U.S. President Joe Biden warned that Russia might begin invading Ukraine within a few days, further escalating fears of conflict in the Eastern European region.

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