Housebuilders Lay the Groundwork for a Bullish FTSE day, According to CMC Markets

European markets have started the week cautiously upbeat, as investors consider the likelihood of more penalties on Russia as proof of extensive atrocities against civilians, as well as other war crimes, emerging in the districts around Kyiv.

Europe

Following a report that the Government has reduced its demand for different firms to pay to a cladding cleanup fund, UK housebuilders are helping to lead the gains on the FTSE100, with the greatest performances headed by Barratt Developments, Persimmon, and Berkeley Group.

Ted Baker shares are up after the company stated it was initiating a formal selling process after rejecting two prior proposals from Sycamore Partners Management last month, the most recent of which was believed to value the firm at £254m, compared to its valuation in 2018 of £1.3bn.

Its most recent Q4 results revealed that group sales increased by 35% compared to a year earlier, up from an 18% increase in Q3. Margins improved as well, reaching 350bps across all channels. Inventory levels have also improved, and sales in shops and retailers have begun to rebound as volumes begin to return to pre-Covid levels.

Airlines are under pressure after reports of delays and cancellations caused by an increase in concussions among personnel, which is creating severe inconvenience at airports around the UK.

Ryanair shares are also down, even though the company predicts a net loss of between €350m and €400m for the fiscal year ending March 31, 2022. It also said that it flew 11.2 million passengers last month, up from 10.9 million in March 2019, with a total of 97 million passengers for the year, which is still significantly below the pre-pandemic figure of 149 million.

Lower Airbus shares have also fallen after the company revealed plans to delay the manufacturing of its A350 aircraft.

US

US markets began uneven as investors weighed the likelihood of further penalties against Russia and a comeback in oil prices after last week's precipitous drop.

Twitter shares rose more than 25% on the open when it was reported that Tesla CEO Elon Musk had purchased a 9.2 percent passive ownership in underperforming social media network Twitter, in one of the most oxymoronic and sarcastic announcements ever.

Whatever you want to say about Elon Musk, passive is not a description that could be assigned to the Tesla CEO. With a holding now worth more than $2.8 billion, we can undoubtedly expect to hear a lot more about this so-called passive stake as he puts pressure on Twitter management to be less censorious.

Tesla also stated that it delivered over 310,000 cars in the first quarter, which was lower than expected but still a record high.

Starbucks shares have also fallen as new CEO Howard Scholz terminated the remainder buyback program to spend finances more on the core company and its employees.

Chinese listed equities have also gained ground after Chinese officials indicated that they may consider loosening some of the secrecy restrictions governing audit monitoring, making it less likely that they would be delisted from US exchanges. Alibaba, Tencent Music, and JD.com have all risen in the rankings.

FX

The euro has fallen below the 1.1000 mark versus the US dollar as the potential of more sanctions on Russian energy weighs on the single currency, owing to fears about the economic harm that such measures would impose on Europe.

The Norwegian Krone is one among the stronger performers based on a comeback in energy prices, while the Australian dollar is also enjoying moderate gains on the back of rising commodity prices. The Australian currency is also receiving a bid ahead of the RBA's rate decision tomorrow, which might see a significantly hawkish tilt given recent steep spikes in inflationary pressure.

Commodities

Following continued demands for more penalties against Russian oil and gas imports, oil prices in the United States have recovered to levels over $100 per barrel. This seems to be outweighing worries about Chinese demand after the whole city of Shanghai, which has a population of 25 million people, was placed on lockdown.

Despite the resilience of US rates, gold prices continue to find support above the 50-day moving average; however, the upside is encountering resistance around the $1,970 mark ahead of the publication of the latest Fed minutes on Wednesday.

Volatility

The build-up to a vote by US legislators to legalize marijuana on a federal level has been a significant issue throughout the previous week. This was approved by a narrow majority on Friday, supporting the recent surge in interest in both particular companies and CMC Markets' customized cannabis basket of shares. Canopy Growth - with the fitting ticker of WEED – had daily vol of almost 300 percent on Monday, compared to a weekly equivalent of 162 percent, while vol in CMC's Cannabis basket peaked at 279 percent earlier in the week. There is a possibility that interest may stay high in the coming days.

In terms of fiat currencies, the Dollar-Yen combination has been in the spotlight since the pair reached a six-year high and then started to fall. The crucial aspects to monitor here are the contrasting fundamentals, with the Bank of Japan retaining its dovish position on policy and purchasing bonds, and the Yen still having some haven attractiveness, even though the greenback offers a significantly superior yield. The activity was again weighted towards the beginning of the week, with volatility hovering above 15%, but it still led the asset class on Friday, printing 9.85 percent vs 8.7 percent for the month.

Soft commodities have also witnessed robust trading, albeit there is a widespread sense that the market has become oversaturated. The Lean Hogs price was a key member of this group, with traders anticipating the publication of statistics from the US Department of Agriculture on the current herd size on Thursday. The contraction was forecast, but the print showed a far more severe decline, causing the underlying to rocket higher before correcting. By Friday, daily volatility was at 96.1 percent, compared to 71.26 percent for the month.

Aside from Bitcoin, cryptos witnessed some activity this week, which seemed to be sparked by the end of the fiscal year in several nations on Thursday. As a consequence, there was some additional selling, which pushed daily volatility in Ripple up to 156 percent in the latter half of the week. Over the weekend, there was some rebound, suggesting that investors merely wanted to lock in profits ahead of the new quarter, and vol might therefore continue high through the start of the new week. Sign up to get a daily volatility report in your email by clicking here.