Is Risk Off Expanding? “Key Points and Event Schedule for March 9”
Over the weekend, New York State declared a state of emergency, OPEC+ ended talks without agreement, Saudi Arabia and Russia announced plans to boost oil production to compete, Lebanon defaulted, and the refugee issue between Turkey and Greece (Europe) has resurfaced.
Multiple risk-off factors are present, and both the forex and stock and futures markets began the week with gaps to the downside.
Today, attention is expected to remain on risk factors.
Also, the United States and Canada are observing daylight saving time, so indicator times are one hour earlier, which requires careful attention.
◎ Today's Points of Focus
1) Risk-off
Attention is shifting from infection numbers in China to those in Europe and the United States.
As infection numbers rise, restrictions on entry and exit, school closures, and event cancellations are risks that can dampen economic activity.
Last week, California triggered a major risk-off move by declaring a state of emergency.
Over the weekend, New York State declared a state of emergency, and the forex market opened with large gaps on the downside.
Today, it is important to watch whether infection numbers and affected regions will expand further and whether new emergency declarations and restrictions on economic activity will emerge.
Additionally, a sell-off driven by risk-off sentiment may continue to unfold.
Prices of stocks and currencies may move sharply, so caution is warranted.
2) Crude Oil Prices
Last week, Russia opposed coordinated output cuts in OPEC+, talks collapsed, and Russia is expected to resume increasing production.
In this context, Saudi Arabia is also said to be increasing output to counter Russia.
The U.S. rig count, a barometer of oil production, rose slightly in the weekend report.
Countries are entering a race to boost production and compete on price, not wanting to fall behind others.
A drop in crude prices would affect stock prices and could fuel stock declines tied to the impact of COVID-19.
◎ Today's Economic Event Schedule
Monday, March 9
08:50 JPY GDP (Q4, 10-12/ period) (revised)
15:45 CHF Swiss unemployment rate
21:00 MXN Mexico CPI (consumer price index)
21:15 CAD Canada housing starts
21:30 CAD Canada building permits
