Market fears abate slightly to start the new week

On Friday, it was all about rushing to seek shelter as markets braced for the uncertainty over the weekend that may befall the Israel-Hamas conflict. But as things weren’t as bad as feared, we’re seeing traders and investors start taking baby steps again to test the waters to start the new week. Here’s a snapshot of things so far today:

• Gold down 0.9% to $1,914.42
• WTI crude down 0.3% to $87.40
• US 10-year yields up 4.2 bps to 4.671%
• S&P 500 futures up 10 points or 0.2%
• DXY (Dollar index) down 0.2%

The moves aren’t close to erasing the flight to safety on Friday but it is a start at least. Gold is held back at its key daily moving averages as pointed out here while the bond market continues to chop around for a bit as traders are still contemplating the Fed’s higher for longer narrative as well in the bigger picture.

In FX, the overall movement among major currencies is still relatively light. EUR/USD is up 0.2% to 1.0530 while USD/JPY is just down 0.1% to 149.48 on the day. The aussie and kiwi are the bigger beneficiaries for now but that owes more to the latter’s jump at the open, after the NZ election results here. NZD/USD is up 0.7% to 0.5925 but even with a better risk mood, I’m inclined to fade the pop here although there’s not much levels to pick at for the moment.