China is worried about jobs, banning Russian oil and markets in a bear hug. Here is what you need to know.
Chinese premier warned of a complicated and grave employment situation as Beijing and Shanghai tightened curbs on residents in a bid to contain Covid outbreak in the country's most important cities. According to a late Saturday statement, Li instructed all government departments and regions to prioritize measures aimed at helping businesses retain jobs and weather the current difficulties. China's top leaders warned against questioning the country last week after the unemployment rate rose to 5.8% in March.
The leaders of the Group of Seven most industrialized countries pledged to ban the import of Russian oil in response to the war in Ukraine. The EU is considering getting rid of Russian oil imports by January, after the U.S. and U.K. banned them. The furthest that Japan has gone to stop buying Russian oil is the pledge.
Losses in equity markets are spreading from risky stocks to steady earners. The S&P 500 fell for five weeks in a row, its longest losing streak in a decade. The Federal Reserve's most aggressive policy tightening in two decades is sucking emerging markets into a slump. Bonds are not immune. The bear market in U.S. Treasury debt could cause yields to break above their highs.
John Lee, who was named Hong Kong's next chief executive in a rubber-stamp election that was criticized as unfair, vowed to strengthen national security and accelerate the city's integration with mainland China. The rule of law is a core pillar of sound governance, he told reporters.
The two candidates for Australia's next prime minister were grilled on cost-of-living issues, corruption and rising inflation at a debate less than two weeks from a national vote. The conversation deteriorated into a shouting match between Prime Minister Scott Morrison and Labor leader Anthony Albanese, with each accusing the other of being unsuitable to lead Australia. The government is behind in opinion surveys.
The last holdout in the bond bull market camp must be packing up and heading home. A new era has begun as Benchmark Treasury yields broke above 3%, moving further above their four-decade downtrend. A cold look at the long-term chart shows that the next stop should be 4%, but that might be too neat for a complicated world. Increased fears of a global recession suggest that some may consider returning to bonds after seeing the higher yields. This year has seen a surge in yields due to traders betting on a plan to raise rates by the Federal Reserve. Chair Powell's comments about the possibility of even bigger hikes have led to a decline in the most right-wing of those wagers. We may be close to a near-term top in the global bond benchmark.
Cormac is a deputy managing editor in the Markets team.
With assistance from Cormac Mullen.
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