EUR

Financial markets are recovering from yesterday’s knee-jerk geopolitical selloff, with the dollar snapping out of a three-day losing streak, Treasury yields marching higher, and North American equity benchmarks setting up for a positive open. Oil prices are slumping on a dissipation in risk premia after Russian presidential spokesman Dmitry Peskov said his country was ready to discuss a possible cease-fire in Ukraine with US President-elect Donald Trump, and safe-haven currencies are giving back their gains. Yield differentials continue to move in the dollar’s favour as traders pull back on expectations for Federal Reserve rate cuts, and the earliest year-ahead outlooks...

Global financial markets are in safety-seeking mode after Ukraine reportedly launched its first long-range missile strike against Russian territory using American-made systems, and Vladimir Putin signed an updated strategic doctrine that would allow Russian forces to deploy atomic weapons in response to a conventional assault from countries backed by other nuclear powers. Ten-year Treasury yields are retreating, North American equity futures are setting up for a drop at the open, and currency markets are displaying classic flight-to-safety characteristics, with the Swiss franc and Japanese yen outperforming their brethren. Like most geopolitical shocks, this should prove short-lived. Investors expect Putin’s sabre-rattling...