MNI US OPEN - BoJ Steps in to Stem Global Bond Rout

NEWS:

BOJ (MNI): BOJ Offers Unlimited JGB Buys To April 26
The Bank of Japan on Wednesday offered to conduct an unlimited purchase of Japanese Government Bonds (JGBs) at a fixed rate from April 21 to April 26 to prevent the 10-year JGB yield from rising above 0.25%, an upper limit of the preferred minus-plus 0.25% range

BOJ (MNI): BOJ To Look Past Yen, Keep Guidance
The Bank of Japan is set to look past the weakening yen and leave its forward guidance unchanged at the April 27-28 policy-setting meeting, maintaining the possibility of lower rates if risks to growth rise and inflation fails to sustainably reach target, MNI understands.

RUSSIA/UKRAINE (Bloomberg): Russia has launched what Foreign Minister Sergei Lavrov hailed as a second phase of the war in Ukraine, and early indications are it could go better for Russia than the first. After a ferocious night of artillery bombardment along a 300 mile (482 km) front line in the east, Russian forces took a pocket of territory including the city of Kreminna on Tuesday, according to the Ukrainian regional governor.

SWEDEN (MNI): Support For Joining NATO Hits New High In Latest Poll
Public support for joining NATO has hit a new high in the latest Demoskop opinion poll for Aftonbladet. Talk of both Sweden and Finland looking to join the defensive alliance has intensified following the Russian invasion of Ukraine.

UK (The Times): Boris Johnson will order his MPs tomorrow to block an investigation into claims that he misled parliament over lockdown-breaking parties in Downing Street. The prime minister offered a “wholehearted apology” yesterday after being issued with a fixed-penalty notice for attending a gathering in the cabinet room to celebrate his 56th birthday.

CHINA (MNI): The People's Bank of China (PBOC) injected CNY10 billion via 7-day reverse repos with the rate unchanged at 2.1% on Wednesday. This keeps the liquidity unchanged after offsetting the maturity of CNY10 billion repos today, according to Wind Information. The People's Bank of China (PBOC) set the dollar-yuan central parity rate higher at 6.3996 on Wednesday, compared with 6.3720 set on Tuesday.

US (Bloomberg): Netflix Inc. shares are on course to lose about $40 billion in value Wednesday after the streaming giant reported its first customer decline in more than a decade. Shares in the company fell as much as 26% premarket trading, extending its plunge this year to 57%. If the losses hold, Netflix is poised to become the worst-performing stock this year in both the benchmark S&P 500 and tech-heavy Nasdaq 100 indexes.

DATA:

MNI: EUROZONE FEB IP +0.7% M/M, +2.0% Y/Y; JAN -0.7%r M/M

MNI: GERMANY MAR PPI +4.9% M/M, +30.9% Y/Y, FEB +25.9% Y/Y

BOND SUMMARY: BoJ's Activist Approach Stems Global Bond Rout

• Global bond futures trade positively headed into the NY crossover, with early weakness in prices partially reversing across the European morning. The run-up in US yields remains a focus, with a new cycle high in the 10y at 2.977% printed in Asia-Pacific hours, before reversing as the Bank of Japan stepped in to defend their yield target of 0.25%. The failure of the US 10y yield to reach and top 3.00% will likely remain a talking point, with speculation that this psychological level could represent a near-term top for markets.
• The activist approach from the BoJ helped stem losses across global bond markets, with the bank pledging to undergo a series of unscheduled operations to enforce their monetary policy goals.
• The BoJ announcements helped Bund futures find a floor at 153.25, adding over a point to sit either side of 154.50 at typing, with the German curve very moderately flatter.
• Focus turns to Canadian CPI and US existing home sales data, as well as speeches from ECB's Rehn & Nagel as well as Fed's Daly, Kashkari, Evans and Bostic. The Fed Beige Book is also up.

FOREX: BoJ Again Step In to Defend Yield Target

• USD/JPY remains a pair in focus, with a new cycle high of Y129.40 printed overnight, before the price action stalled and the pair reverted back below Y128.50. The move came ahead of more activity from the Bank of Japan, who again stepped in to defend their 0.25% yield target by buying JGBs to stem upside pressure on rates.
• The USD is on the backfoot headed into the NY crossover, helping put the likes of EUR/USD at the session's best levels following a few hours of European trade. Modest strength in European equities accompanies the move in the greenback, with the EuroStoxx50 hitting the best levels since Apr11.
• Lastly, antipodean currencies trade well, with AUD and NZD outperforming amid broader weakness in the Chinese currency, as the authorities set the USD/CNY midpoint at a much weaker-than-expected level - potentially a signal that a more activist approach to currency could be adopted if growth targets continue to slip away.
• Canadian inflation data takes focus going forward, with markets expecting CPI to have risen 6.1% on a Y/Y basis, to be shortly followed by US existing home sales for March. A number of central bank speakers are due, with ECB's Rehn, Nagel on the docket as well as Fed's Daly, Evans and Bostic.

EQUITIES: Stocks Inch Higher on Busy Day For Earnings

• Japan's NIKKEI closed up 232.76 pts or +0.86% at 27217.85 while the TOPIX finished higher by 19.45 pts or +1.03% at 1915.15. China's SHANGHAI closed down 42.979 pts or -1.35% at 3151.05 and the HANG SENG ended 83.09 pts lower or -0.4% at 20944.67.
• Germany's DAX trades higher by 114.47 pts or +0.81% at 14267.93, FTSE 100 up 30.58 pts or +0.4% at 7631.86, CAC 40 up 79.14 pts or +1.21% at 6613.93 and Euro Stoxx 50 up 49 pts or +1.28% at 3879.58.
• Dow Jones mini down 4 pts or -0.01% at 34838, S&P 500 mini down 4.25 pts or -0.1% at 4455, NASDAQ mini down 31.75 pts or -0.22% at 14185.5.

COMMODITIES: Copper Slips to New Weekly Low

• WTI Crude up $1.1 or +1.07% at $103.66
• Natural Gas down $0.08 or -1.06% at $7.1
• Gold spot down $3.4 or -0.17% at $1946.68
• Copper down $5.5 or -1.16% at $468.45
• Silver down $0.2 or -0.79% at $24.9819
• Platinum down $17.28 or -1.74% at $976.01