The global selloff that started in Asia, sending China’s CSI300 plunging to the lowest level since May 2020, slamming the offshore yuan below 6.60 and sparking a liquidation in oil and cryptos amid fears that the Shanghai lockdown will spread to the capital Beijing and lead to an even greater slowdown in the global economy…
… has quickly spread around the globe, slamming not just European markets but US equity futures which slid as much as 1% as traders fretted over the prospects of aggressive tightening by the Federal Reserve, Chinese lockdowns and disappointing earnings. S&P 500 futures were down 0.9% as of 7:00am EDT after plunging 2.8% on Friday, while Nasdaq futures retreated 0.8%, with the rout hammering tech stocks especially hard. Some context: the Nasdaq 100 Index has erased about $1 trillion in market value since Netflix released disappointing earnings and is closing in on oversold levels; the tech-heavy FANGMAN basket has lost $2.4 trillion in market cap from 2021 ATH as Netflix and Facebook Meta, have lost most of their gains from past 5yrs. Remember when Facebook hit the $1tn market cap club in 2021? Now it’s worth exactly half that.
But now the tech bear market is finally spreading all US stocks which closed at their lowest levels in more than a month on Friday as fears over a more aggressive Federal Reserve tightening cycle led to broad-based selling. Investors are entering another busy week for big technology companies’ earnings, with Alphabet, Microsoft, Meta Platforms, Paypal and Apple all reporting results although don’t expect some miraculous surge.
Investor mood was already morose after Fed chair erome Powell’s hawkish comments last week hurt sentiment already sapped by the war in Ukraine, a slowdown in China and the risks inflation poses to company earnings, according to Michael Hewson, chief analyst at CMC Markets in London. “The final straw appears to be a concern about the prospect of a policy mistake by central banks, and a possible recession by the end of the year,” he said.
One sole glimmer of green, Twitter shares, rose 0.6% in premarket trading after a WSJ report that Elon Musk met with the social media platform’s executives on Sunday as the company turns more receptive toward the billionaire’s $43 billion takeover offer. As discussed earlier, U.S.-listed Chinese stocks fell in premarket trading as expanded Covid lockdown measures in major Chinese cities spark concerns over the country’s growth outlook. Pinduoduo led a decline in American depositary receipts, down 4.7% in premarket trade. E-commerce peers Alibaba Group fell 3.9% and JD.com lost 2.5%. Electric carmakers including Nio and Li Auto also fell. The weakness tracks a 4.9% slump in China’s CSI 300 Index, which closed at its lowest level in two years. Here are some other notable premarket movers:
- U.S.-listed Chinese stocks look set to open lower on Monday as expanded Covid lockdown measures in major cities sparked concerns over the country’s economic growth outlook.
- Pinduoduo (PDD US) led a decline in American depositary receipts, down 4.7% in premarket trade. E-commerce peers Alibaba (BABA US) fell 3.9% and JD.com (JD US) lost 2.5%. Electric carmakers including Nio (NIO US) and Li Auto (LI US) also fell.
- AT&T (T US) reinstated with a buy rating at Goldman Sachs with the focus turning to the telecom giant’s core business, while the broker cuts its rating on Verizon (VZ US) on valuation grounds. AT&T up 0.6% in premarket, Verizon -1.4%.
- Cenntro Electric (CENN US) rises as much as 22% premarket ahead of the electric-vehicle company’s quarterly update due after the close on Monday.
- Kellogg (K US) was downgraded to hold from buy at Deutsche Bank, which stays cautious and below consensus ahead of 1Q22 results because of headwinds including worsening inflation and supply chain disruptions. Shares down 1.4% in premarket.
- Morgan Stanley says DoorDash (DASH US) is the “best executor around” among food delivery companies, but awaits a better entry point as initiates at equal-weight with Street- low $100 target. Shares down 1.1% in premarket on low volume.
- GoDaddy (GDDY US) upgraded to overweight at Piper Sandler on strong free cash flow potential, with the broker cutting its ratings on Wix.com (WIX US) and Squarespace (SQSP US) in a rejig of its digital presence coverage. GoDaddy little changed in premarket, Wix.com and Squarespace not traded.
Coca-Cola and Activision Blizzard are among companies reporting earnings today.
In Europe, markets are under heavy pressure: Euro Stoxx 50 drops as much as 2.6% with several other core indexes down over 2%. Spain’s IBEX outperforms. Miners are the weakest performers with the Stoxx 600 sector down over 5%. Energy and consumer products and services similarly lag. Europe’s Basic Resources Index crashed 6%, and was set for the worst daily drop since March 2020. Here are some of the biggest European movers today:
- Ubisoft shares rise as much as 12% after Bloomberg reported the video-game publisher is attracting takeover interest from private equity firms including Blackstone and KKR.
- Garanti stock rallies as much as 5.6% after parent BBVA sweetened its voluntary offer for the Turkish lender and the unit said 1Q net income tripled.
- Biogaia shares rise as much as 9.6% after the Swedish food-additives and supplements maker published preliminary 1Q sales figures, which included a large beat on operating profit and net sales.
- Barco shares rise as much as 4.2% after the projector maker’s Cinionic JV won a contract to install laser projectors in 3,500 U.S. auditoriums of cinema chain operator AMC.
- The Stoxx 600 Basic Resources and Energy sub- indexes both slumped on Monday amid broad declines for commodities prices on concerns that a growing Covid-19 outbreak in China will hit demand.
- Shell -4.5%, TotalEnergies SE -3.1%, Glencore -6.0%, Anglo American -6.5%
- Philips stock falls as much as 11% after publishing its latest earnings, where higher provisions related to its recall of Dreamstation breathing machines overshadowed better-than-expected 1Q sales.
- Roche shares fell as much as 3.6% after the Swiss pharma company reported mixed first quarter results. Sales beat expectations due to a boost to the diagnostics division, while the pharmaceutical unit missed.
As we reported on Sunday, the big news out of France is that Macron won the second round of the Presidential Election with 58.6% of the vote vs Le Pen at 41.4%, while Le Pen conceded defeat after the initial projections, according to Reuters and Sky News. Elsewhere, ECB President Lagarde commented that interest rate hikes will not lower energy prices, according to Barron’s. ECB policymakers are said to be keen to finish bond purchases as soon as possible and possibly hike rates in July but no later than August, while they are leaning towards two rate moves this year with three also a possibility, according to Reuters sources. However, an ECB spokesperson declined to comment on the timing of ending bond purchases and potential interest rate increases. The EU is said to prepare the creation of a new trade and tech council with India, according to FT sources. The new forum could be unveiled on Monday during the European Commission President’s visit to India.
Earlier in the session, Asian stocks slumped the most since March 11 as China’s worsening Covid-19 outbreak and a looming rate hike by the Federal Reserve hurt risk sentiment. The MSCI Asia Pacific Index fell as much as 2.2% Monday, setting off a grim start to the region’s busiest week for earnings. The biggest drags were technology stocks sensitive to higher interest rates, including Taiwan Semiconductor Manufacturing, Alibaba and Tencent. Equities in mainland China and Hong Kong were among the region’s worst performers. Chinese stocks slid to a two year low amid fears that rising infections in Beijing may spur an unprecedented city-wide lockdown of the capital. The Chinese regulator also ordered platform companies to better handle online violence, dragging tech stocks lower. READ: China Lockdown Angst Rips Through Markets as Stocks, Yuan Plunge The lockdowns that have now expanded to parts of Beijing will “cause a logistical problem that’s going to affect not just China but also the rest of the world,” Jeffrey Halley, Asia Pacific senior market analyst at Oanda, said in an interview with Bloomberg TV. With no signs of change in Covid zero policy and very little in terms of actual stimulus, “that all points to lower China stocks and we are going to see a weaker yuan going forward,” he added. Investors are also on guard for corporate earnings. Stock-market heavyweights including Kweichow Moutai in China and Samsung Electronics in South Korea are expected to release first-quarter results this week. With a number of Fed speakers recently showing support for 50-basis-point hikes, tech shares led declines of major gauges in the region. Taiwan’s Taiex dropped 10% from its January high.
Japanese equities dropped, extending a global selloff amid prospects for aggressive U.S. interest-rate hikes and a worsening Covid outbreak in China. Electronics and machinery makers were the biggest drags on the Topix, which fell 1.5%, with 32 of 33 industry groups in the red. Fast Retailing and SoftBank Group were the largest contributors to a 1.9% loss in the Nikkei 225.
Indian stocks also fell, joining their peers across Asia, as appetite for risk waned amid renewed concerns over Covid infections and its possible impact on business growth. The S&P BSE Sensex dropped 1.1% to 56,579.89, while the NSE Nifty 50 Index slipped 1.3% to 16,953.95. Reliance Industries Ltd. lost 2.3%, the most in seven weeks. It was the biggest drag on the Sensex, which saw 23 of its 30 stocks trading lower. All but one of 19 sectoral sub-indexes compiled by BSE Ltd. declined, led by a gauge of metal stocks. The continued war in Ukraine and fears of a wider lockdown in Beijing are weighing on sentiment, already impacted by the risk of a global slowdown as the U.S. Fed raises rates to tame inflation. Of the six Nifty 50 firms that have announced results so far, four have missed, while two have beaten analyst estimates. Bajaj Finance, Hindustan Unilever, Axis Bank are among the companies releasing Jan-March earnings this week.
With risk off, safe havens were mostly bid: Treasuries advanced across the curve, with yields on the belly falling about 10bps and 10Y yields sliding 8bps to 2.833%. The belly of the UST curve outperforms by 1-2bps. Peripheral spreads widen to core with 10y Italy lagging peers on the rally. European bonds advanced, yet underperformed Treasuries; the spread between French 10-year bond yields and German equivalents tightened at the open after President Emmanuel Macron was re-elected as French president, only to widen as haven demand supported bunds. IG dollar issuance slate empty so far; preliminary estimates are for around $25 billion this week. • Three-month dollar Libor +1.11bp to 1.22486%.
In FX, the Bloomberg Dollar Spot Index rose a third day to the highest level since May 2020; the greenback advanced against all of its Group-of-10 peers apart from the yen and the Swiss franc; AUD and NZD lag G-10 peers. USD/JPY holds above 128. The euro fell to its lowest level versus the dollar since March 2020, erasing earlier gains amid broader greenback strength. The pound slumped to the lowest versus the dollar since September 2020 and gilts advanced. The Aussie was the worst G-10 performer amid fears over the outlook for China’s demand for iron ore and with the selloff boosted by options-related selling. The yen rose, as concerns about the economic impact of accelerating U.S. rate increases put a pause on the recent aggressive selling of the currency. Japan’s government bonds tracked Treasuries higher with support from purchases by the Bank of Japan.
Perhaps most importantly, the yuan – which until now had resisted any weakness – plunged again, dropping to the lowest level in 17 months as the offshore yuan dropped below 6.60 the lowest level since Nov 2020, spurring a selloff in emerging-market currencies.
In commodities, crude futures sold ell off with WTI down over 4% and back on a $97-handle. Base metals are similarly deep in the red. Spot gold drops ~$14 to trade near $1,916/oz. Monday’s pullback in the soaring price of commodities since Russia’s invasion of Ukraine has done little to assuage concerns about runaway inflation. Fed Jerome Powell had outlined his most bold approach yet to reining in surging prices and the European Central Bank signaled stronger tightening.
Bitcoin continued to tumble alongside the broader crypto market, even though the harder the stocks fall and the more the Fed tightens, the more it will eventually have to ease, unleashing the next surge higher in cryptos which we expect to push bitcoin over $100,000 and Ether over $10,000.
Looking at the calendar, the economic data slate includes March Chicago Fed national activity (8:30am) and April Dallas Fed manufacturing activity(10:30am); consumer confidence, GDP, PCE deflator and University of Michigan sentiment are ahead this week. Today we will earnings from Coca-Cola, Activision Blizzard, Vivendi.
Market Snapshot
- S&P 500 futures down 0.7% to 4,235.25
- STOXX Europe 600 down 1.8% to 445.31
- MXAP down 2.0% to 166.02
- MXAPJ down 2.4% to 546.02
- Nikkei down 1.9% to 26,590.78
- Topix down 1.5% to 1,876.52
- Hang Seng Index down 3.7% to 19,869.34
- Shanghai Composite down 5.1% to 2,928.51
- Sensex down 1.0% to 56,637.35
- Australia S&P/ASX 200 down 1.6% to 7,473.28
- Kospi down 1.8% to 2,657.13
- German 10Y yield little changed at 0.89%
- Euro down 0.4% to $1.0751
- Brent Futures down 4.4% to $101.96/bbl
- Gold spot down 0.6% to $1,920.54
- U.S. Dollar Index up 0.20% to 101.43
Top Overnight News from Bloomberg
- China’s coronavirus outbreak worsened as rising cases in Beijing sparked jitters about an unprecedented lockdown of the capital, with policy makers racing to avert a Shanghai-style crisis that’s already wrought havoc on the financial hub
- China must take stronger action to boost growth above 5% in the second quarter, said a central bank adviser who warned the country needs to lay a foundation for achieving its full-year target in the face of rising economic risks
- A sustained and substantial increase in U.S. real yields would be bad news for developing nations as it typically boosts the dollar and sucks capital out of riskier assets, like in 2008 and 2013
- The U.S. announced it would start sending diplomats back to Ukraine and provide more military aid as Secretary of State Antony Blinken and Secretary of Defense Lloyd Austin visited Kyiv late on Sunday night, in the highest- level U.S. visit to the war-torn country since Russia invaded
- China’s central bank stepped up its support for several distressed developers by allowing banks and bad-debt managers to loosen restrictions on some loans to ease a cash crunch, according to people familiar with the matter
A more detailed look at global markets courtesy of Newsquawk
APAC stocks traded negatively after last Friday’s stock rout on Wall Street with risk sentiment hampered by holiday closures, China’s COVID-19 woes and as participants brace for a busy week of key earnings releases. Nikkei 225 shed around 500 points with sentiment not helped by several earnings guidance downgrades and with Nissan shares were hit as alliance partner Renault mulls selling a partial stake in the Japanese automaker. Hang Seng and Shanghai Comp underperformed on the COVID situation after daily deaths in Shanghai rose again and with the city to conduct another round of mass testing, while Beijing also scrambles to contain an outbreak with its Chaoyang district to require residents and workers to undergo three COVID-19 tests this week.
Top Asian News
- Asia Stocks Fall Most in Six Weeks as China Outbreak Worsens
- China Woes Stoking Inflation Angst Set to Weigh on the Euro
- Shimao Unit Proposes to Pay Down Puttable Bond Faster: REDD
- Loan Curbs Eased for Distressed Developers: Evergrande Update
European cash markets kicked off the week lower across the board with a relatively broad-based performance seen across the majors. Sectors are lower across the board with a clear defensive tilt: Energy and Basic Resources sit at the bottom of the bunch amid hefty downside in underlying commodities. Stateside futures are lower in tandem with the broader market sentiment, whilst the NQ is slightly more cushioned by the earlier decline in yields. Twitter is reportedly re-examining Elon Musk’s bid and be more receptive to a deal with the sides meeting on Sunday to discuss the proposal. It was separately reported that Twitter is facing increasing shareholder pressure to negotiate with Elon Musk in his takeover bid and that the Co. is in talks with Elon Musk in which a potential deal could be made as early as this week, according to WSJ.
Top European News
- Macron Gets Second Chance to Show France His Vision Can Work
- Credit Suisse Special Audit Backed by Norway’s Wealth Fund
- SocGen Too Quick to Axe Boss Accused of Trying to Kiss Colleague
- Art Seized at U.S. Homes Part of Crackdown on Wealthy Russians
FX:
- DXY sets new 2022 peak at 101.750 amid safety flight and sharp slide in crude alongside other commodities.
- Yen back in favour as risk sentiment sours irrespective of denials about joint Japanese and US intervention discussion – Usd/Jpy towards base of 128.87-127.89 range.
- Aussie underperforms on Anzac Day due to steep decline in copper and iron ore – Aud/Usd tests 0.7150 and Aud/Nzd cross under 1.0850 vs 1.0940 at one stage overnight.
- Yuan extends depreciation as Covid spreads to a district in Beijing and PBoC continues to lower Cny midpoint reference rate – Usd/Cnh just shy of 6.6000, Usd/Cny eyeing 6.5650.
- Euro averts 1.0700 test, narrowly, and pares more losses after surprisingly upbeat Ifo survey, on the surface – Eur/Usd rebounds to circa 1.0750, but still well below Macron victory high.
- Pound loses Fib support on the way through 1.2800 and sub-8400 vs Dollar and Euro respectively.
Fixed Income
- Debt futures firm as risk appetite wanes, but bonds fade beyond 154.50 in Bunds, 119.00 in Gilts and 119-25 in the 10 year T-note.
- Core EZ bonds lose momentum after German Ifo survey beats and irrespective of less encouraging accompanying statements.
- French OATs off peak within 147.38-146.28 range posted on confirmation of Macron defeating Le Pen to retain Presidency.
- European Commission sells EUR 2.499bln (exp. EUR 2.500bln) 0.4% 2037 NGEU; b/c 2.05x (prev. 1.49x), average yield 1.626% (prev. 0.375%).
Commodities:
- WTI and Brent June contacts have continued to decline since the resumption of futures trading.
- Spot gold has been caged to a near-USD 5/oz range since the European open as the impact of a firming Buck negated the effects of lower yields at the time.
- Base metals are in a sea of red as China’s lockdown woes hit the demand side of the equation – with LME aluminium and zinc the laggards at the time of writing.
US Event Calendar
- 08:30: March Chicago Fed Nat Activity Index, est. 0.45, prior 0.51
- 10:00: Revisions: Retail Sales, Inventories
- 10:30: April Dallas Fed Manf. Activity, est. 4.8, prior 8.7
DB’s Jim Reid concludes the overnight wrap
I survived a weekend alone with my kids but the only way for all of us to cope was to comfort eat and spend so much time on Netflix that I may as well cancel my subscription as there is nothing left to watch now. Never has Mum been so welcome by an adult, 3 kids and a dog, as she was on her return last night. Parenting is hard!
Central bankers are finding it hard too at the moment and it was a fascinating past week on that front as several important central bankers belatedly played a game of leapfrog on who could make the most aggressively hawkish rhetoric on taming inflation. Those speaking at the start of the week might have seemed hawkish at the time but by the end of the week they almost looked dovish. The IMF/World Bank gathering probably focused the minds of all the Governors, Presidents and Chairs present and hawkishness spread through the event like wildfire with the notable exception of Japan’s Kuroda who is seemingly sticking to the country’s YCC. We are now in the Fed blackout period so they won’t add to the hawkishness for the 9.5 days before we get the FOMC decision. Note that the BoJ meet on Thursday although nothing suggests they are going to pivot and will remain the last hawkish shoe to drop.
The French election has passed without incident with President Macron gaining 58.6% of the vote vs. 41.4% for Le Pen. Macron won 66.1% of the second round vote in 2017 and with him unable to stand in 2027 and with the traditional parties share of the vote at record lows who knows where French politics will be by then. However much water will flow under Le Pont des Arts before we need to worry about that. Meanwhile, the next hurdle for Macron will come with the Parliamentary elections on the 12th and 19th of June. Commonly referred to as the ‘third round’, the elections will be crucial as it will define the make-up of the government Macron must rely on to push through his reform program. See Marc de-Muizon’s blog last night here for more on this. The Euro popped nearly +0.6% higher at the Asian open after the results became clear but has subsequently dipped into negative territory as risk off dominates in Asia.
Mainland Chinese stocks are sliding with the Shanghai Composite (-1.95%) and CSI (-2.39%) down, falling to its lowest level since 2020 amid the worsening Covid situation in China, particularly in the financial hub of Shanghai. Strict restrictions have begun to spread, with authorities ordering mandatory Covid tests in a district of Beijing and many buildings locked down. The Hang Seng (-2.47%) is also lagging and elsewhere, the Nikkei (-1.94%) and Kospi (-1.44%) are weak. Outside of Asia, futures contracts on the S&P 500 (-0.42%) and Nasdaq (-0.30%) are lower with 2 and 10yr US yields both around -5bps lower. Brent and WTI are both around -2.9%.
Moving on to this week now and it is an important one for European inflation with German CPI on Thursday and the French and Italian equivalent (plus PPI) on Friday with the overall Euro CPI the same day. US (Thursday) and European Q1 GDP (Friday) will also be of interest.
Back to the US and inflation related data will be the closest watched with Friday’s ECI expected to be strong. This is one of the key indicators the Fed use for labour market strength. The core PCE deflator (the Fed’s preferred inflation measure) also comes out as part of the income and spending report data on Friday. The rate of growth may well tick down here so this might provide a shred of good news on inflation without changing the story too much.
It will be an important week for corporate earnings too with 179 of the S&P 500 reporting and 134 in the Stoxx 600. Big US tech will be the highlight with Microsoft and Alphabet (tomorrow), Meta (Wednesday), and Apple and Amazon (Thursday). Consumption patterns will be in focus when we get results from Coca-Cola (today), Mondelez, Chipotle (tomorrow), Kraft Heinz (Wednesday) and McDonald’s (Thursday). Meanwhile, a range of banks across the globe will give a pulse check on consumer credit. Notable reporters will include HSBC, UBS, Santander (tomorrow), Credit Suisse (Wednesday), Barclays (Thursday), finishing with BBVA and NatWest on Friday. Other notable financials reporting will include Visa (tomorrow), PayPal (Wednesday) and Mastercard (Thursday).
Other tech-related companies releasing results will include Activision Blizzard (Monday), LG, Qualcomm, Spotify (Wednesday), Samsung, Intel and Twitter (Thursday). In healthcare, another sector that benefitted from the pandemic, reporters will include Novartis (tomorrow), GlaxoSmithKline (Wednesday), Eli Lilly, Merck, Sanofi (Thursday) and AstraZeneca (Friday).
To see how the commodity rally and the focus on energy transition affected major commodity companies worldwide, markets will get earnings from Iberdrola, Vale (Wednesday), Total, Repsol (Thursday), Exxon, Orsted, Chevron and Eni (Friday). Downstream users like transport firms will report too, including General Motors (tomorrow), Boeing, Mercedes-Benz and Ford (Wednesday). Other notable corporates releasing results will include Texas Instruments, General Electric, UPS and Caterpillar.
The rest of the day by day calendar of events appears at the end as usual on a Monday.
Reviewing last week now, as discussed at the top a cadre of central bank officials reinforced the idea that monetary policy needs to tighten on both sides of the Atlantic this year, thus driving sovereign yields higher.
Chair Powell, in his last remarks before the Fed’s May meeting communications blackout, lent credence to the wisdom of front loading the hiking cycle and getting policy rates to neutral as quickly as possible. Regional Fed presidents, spanning ideologies, concurred throughout the week. Short-term markets ended the week pricing more than 150 basis points of tightening over the next three meetings, embedding some risk premium for a 75 basis point hike at each meeting. Futures markets are implying Fed policy rates will be north of 2.80% by the end of the year, above the Fed’s estimates of neutral.
President Lagarde was careful to draw a distinction between the US and European situation, but nevertheless would not rule out an increase to ECB policy rates as early as July, following the cessation of net APP purchases, which is likely early in the third quarter. Markets are pricing 24 basis points of ECB tightening by the July meeting, and 85 basis points of tightening for the rest of the year.
Bank of England Governor Bailey highlighted the path of policy was laced with uncertainty, but inflation was likely to increase due to rising energy costs. Bailey added the bank would not sell its security holdings into fragile markets.
Even committed dove, Ingves of the Swedish Central Bank, rowed back on his previous mantras and acknowledged tightening was needed.
As a result, Sovereign yields were higher in each jurisdiction, with 10yr Treasury, bund, and gilt yields increasing +8.2bps (-1.2bps Friday), +10.6bps (+2.4bps Friday), and +7.4bps (-4.9bps Friday), respectively. For their part, 10yr OAT yields closed the week at a +44.5bp spread above bund equivalents, their tightest since March, as President Macron’s polling advantage increased heading into yesterday’s election.
Equity indices retreated on the tighter policy path. The STOXX 600 fell -1.42% (-1.79% Friday) while the S&P 500 was -2.75% lower (-2.77% Friday), bringing it into correction territory YTD (-10.37%) again. Mega cap tech stocks bore the brunt, with FANG+ falling -8.76% (-1.99%) as higher discount rates hit valuations. The mega cap losses accelerated after Netflix reported it lost subscribers in the first quarter, which sent its share prices more than -35% lower. The reprieve was only temporary the following day when Tesla reported a record profit on the back of surging electric car demand.
Brent crude oil futures were relatively subdued by comparison to other asset classes and recent volatility, falling -5.43% (-2.48% Friday) over the week to $105.64/bbl.
Elsewhere the IMF revised down their global growth expectations in light of Russia’s invasion, expecting the global economy to grow 3.6 percent in each of the next two years. Fighting continued in eastern Ukraine, with Russia declaring victory over the port city of Mariupol, while there was not any material public progress in peace negotiations. The Credit Derivatives Determinations Committee said Russia’s remuneration of foreign currency bonds with rubles would constitute a default and trigger credit default swaps. Russia has a 30-day grace period, which ends May 4, to make creditors whole.
