for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up

MORNING BID- Looking past Archegos

March 30 - A look at the day ahead from Danilo Masoni.

Risk-on sentiment is timidly reappearing as hopes grow that the Archegos fiasco will just spoil quarterly results at a few big banks without inflicting any systemic global damage.

And with the policy backdrop supportive of a recovery from the Covid-19 downturn, bond yields have regained momentum and Germany’s DAX equity index looks set for another new historic peak at the open, extending its record-breaking run.

Ten-year U.S. Treasury yields, back above 1.75%, have just set a 14-month high.

U.S. equity futures are subdued however. As President Joe Biden readies a multi-trillion dollar infrastructure bill and higher Treasury yields lift the dollar to four-month highs, investors are booking profits off pricey tech stocks.

The search is on instead for plays better geared to economic recovery.

On the Archegos front, pressure eased a tad off Nomura shares which had on Monday endured a 16% drop, while in Europe, eyes are on Credit Suisse following a fall of nearly 14%. Both have warned of major losses from lending to Archego for derivatives trades.

Investors will wait to see if the events could scupper a planned one billion Swiss franc ($1.08 billion) share buyback this year by Credit Suisse.

Elsewhere in corporate news, a deeply discounted cash call is set to hit tower company Cellnex.

Key developments that should provide more direction to markets on Tuesday:

* Japanese retail sales fell for the third straight month in February as households kept a lid on expenditure

* BOJ Governor offered a cautiously optimistic view of the economy, saying global and Japanese growth are picking up thanks to aggressive stimulus measures

* The Federal Reserve is “a long way from raising interest rates at this point,” Fed Governor Christopher Waller said

* Britain’s Royal Mail to pay a one-off dividend for the year ending March: Imperial Brands maintained its full-year adjusted profit growth forecast

* German flying taxi startup Lilium to float on U.S. markets via a reverse merger with blank-cheque firm Qell Acquisition Corp, valuing the combined company at $3.3 billion

* Fed Deputy chair for supervision, Randall Quarles is to speak.

* Swedish National Bank Stefan Ingves Speaks 1500 GMT

* New York Fed President John Williams 1800 GMT.

* Emerging markets: Chile central bank meets

* German prelim CPI

* US consumer confidence

Reporting by Danilo Masoni; editing by Sujata Rao

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up