Julien Ponthus shows you a glimpse at tomorrow’s markets.

With yields on U.S. government 10-year debt exceeding 1%, 2.2%, and 3.3%, the global tightening cycle in monetary policy has hit a milestone.

The rising trend can be seen further with the Federal Reserve, which is hawkish, expected to raise interest rates another 2.5% by 2022. This would start with 50 basis points, the largest increase in over two decades.

Tomorrow will be the Bank of England’s scheduled meeting. Markets pricing will increase for the fourth time in succession. It is also expected to price another hike, which would mark the first such move since 1997.

In spite of the uncertainty caused by war in Ukraine, and supply chain disruptions due to COVID-19 lockdowns at China, more investors are placing their money on an European Central Bank liftoff in July.

As policymakers push for a tightening policy cycle, the risk is growing that a policy error could lead to a recession and/or a market meltdown.

Investors blame Nasdaq for its downfall because of fast-rising yields, which tend to increase the appeal of “risk-free” government bonds returns and detract from the attractiveness of growth stocks.

This is a very interesting story about London’s miners, oil majors, and value-heavy (read: cheap) London.

In 2022 the UK blue chip stocks have risen 2.4%, while Nasdaq has lost nearly 20%. Even taking out currency effects like the increasing greenback, London index holds the edge with only 5.6% annual decline.

Graphic: FTSE vs Nasdaq: https://fingfx.thomsonreuters.com/gfx/mkt/gdpzyajnyvw/Pasted%20image%201651581433097.png

On Wednesday, key developments should give more direction to the markets:

New Zealand’s financial systems remain robust, says RBNZ

March: German exports fell more than anticipated

Euro zone retail sales

OPEC/non-OPEC meeting

-U.S. Federal Reserve’s Federal Open Market Committee (FOMC) meeting and press conference  1800 GMT

-U.S. MBA mortgage applications/ADP payrolls/international trade/ISM non manufacturing PMI

-Brazil central bank meeting. Rates will rise 100 bps to 12.755%

Volkswagen’s outlook remains positive as a global network compensates for supply chain problems [nL5N2WW15J)

-Hugo Boss sticks to 2022 outlook despite COVID restrictions, Ukraine war

U.S. earnings: Office Depot (NASDAQ:),  Marriott, Yum Brands, New York Times,  Uber (NYSE:), eBay (NASDAQ:), Metlife (NYSE:)