Morning wrap (10.10.2022)

• Risk-off moods could be spotted on indices from Asia-Pacific during the first session of a new week. S&P/ASX 200 dropped 1.4% while Chinese indices trade up to 3% lower after a week-long holiday. Japanese exchanges were shut for national holiday

• US and European index futures trade lower. DAX futures trade around 100 points below Friday's cash close

• Russian President Putin called weekend strike on Crimean bridge a terrorist attack on key civilian infrastructure and blamed Ukrainian special forces for it. Comments sparked fears of a retaliation and escalation

• Risk moods took a further hit this morning after reports of strong explosions in the center of Ukrainian capital Kyiv. Reuters reports that President Zelensky's office was probably struck

• Chinese services PMI dropped from 55.0 to 49.3 in September (exp. 54.6)

• Cryptocurrencies are trading mostly lower with Bitcoin dropping 0.4% and Ethereum moving 0.3% lower. Overall, scale of moves is rather small

• Oil is trading slightly lower this morning with both Brent and WTI dropping around 0.5%

• Precious metals pull back amid USD strengthening. Gold and platinum drop around 0.5% while silver trades almost 2% lower

• USD and JPY are the best performing major currencies while AUD and NZD are top laggards

In spite of a tense geopolitical situation and general risk-off moods, gold is underperforming with strong USD (USDIDX, inverted blue overlay) limiting any upside potential for precious metal. Source: xStation5