Weekly Market Insight

Latest Economic & Market Update 2nd March 2021

02nd March 2021

Good afternoon, it is March 2nd 2021 and here is your economic and market update from BlackBee. 

Today’s focus:

  • Australian Central Bank purchases sovereign bonds post sell off
  • Dublin most popular new home for financial firms post Brexit

The Australian central bank doubled the amount of its standard government bond purchase yesterday, lowering the country’s sovereign debt yields. Reserve Bank of Australia (RBA) purchased A$4n($3.1bn) in long term bonds on Monday, following Fridays’ unscheduled purchase of A$3bn short dated paper. The move by RBA lowered the 10 year yield of Australian Government bond by 25 basis points to 1.67%. Last week following the global bond sell off, the Australian 10 year yields rose as high as 1.93%. Yields rise when bond prices fall due to selling. RBA’s action is noteworthy as it demonstrates a central bank’s attitude to keeping borrowing costs subdued. The ECB and Fed will be closely monitored by investors to see if a similar action is taken. The ECB is able to purchase European government bonds under the pandemic’s bond buying program. Lowering borrowing costs will be used by central bank’s to reach inflations targets. The ECB’s inflation target is “just under 2%”. According to Eurostat, annual inflation in the Eurozone for February 2021 is expected to be 0.9%, level with the previous month’s estimates. (Source: FT, Eurostat)

Dublin remains the relocation destination of choice for financial services firms, according to the EY Financial Services Brexit Tracker. 40% of firms monitored by EY have confirmed at least one location in Europe where they are relocating or consider moving staff and operations to. Off the 88 companies that said a move will occur due to Brexit, 34 said they have or are considering moving to Dublin. Luxembourg is second in the list with 26 companies attracted to the city-state. (Source: EY)

Best & Worst Performers of Large Cap US Stocks on Monday
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Global Market Update
(as at close of markets 01/01/2021)