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RockCreek Daily Market Update

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GLOBAL MARKET SNAPSHOT 

Equity Markets:  
Markets came out of the gate hot this week as risk was on across the board. Investor sentiment was given a boost by positive early results from Moderna’s coronavirus vaccine trial, promising data on new infections in areas that have begun to reopen, and Fed Chair Powell’s upbeat comments in a 60 Minutes interview last night. In the U.S., small cap value surged with the Russell 2000 Value ETF (IWN) +7.8%. On a sector basis, performance was led by energy +7.9%, industrials +6.6%, and financials +5.3%. In Europe, despite the imminent repeal of short-selling bans in France, Spain, Italy, Belgium, Austria and Greece, markets were led by some of the hardest hit, growth-sensitive industries (e.g., materials, autos, travel). India was the exception, as an underwhelming stimulus package weighed on local markets, especially financials that make up about a quarter of the index.

Bond Markets:
The Treasury curve saw a sharp bear steepening as 30-year yields rose 11 bps, while Fed Chair Powell’s dovish commentary last night put a cap on front-end rates. Italian bonds rallied with yields hitting their lowest level in over a month after France and Germany proposed a €500 billion recovery fund offering grants to the regions hardest hit by coronavirus.

Currency Markets:  
The U.S. dollar index decreased -0.7% as the forex market reflected the risk-on sentiment seen elsewhere. The risk barometer, AUD/JPY saw its best day in over a month as commodity-sensitive crosses outpaced the havens by a wide margin.

Commodity Markets:  
The Bloomberg Commodity Index increased +2.2% as hopes of accelerated openings gave a boost to growth expectations and thus resource demand. The energy complex outperformed with WTI +8.1% to $31.82 per barrel.

MACRO OVERVIEW

There were no notable macroeconomic releases on Monday. 

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The information contained herein has been prepared solely for informational purposes and is not an offer to buy or sell or a solicitation of any offer to buy or sell any security or to participate in any strategy. Nothing contained herein shall be relied upon as a promise or representation as to the past or future performance.   This material represents the views of RockCreek.  This information should not be construed as investment advice. Some of the information may be provided to discuss general market activity, industry or sector trends, or other broad-based economic, market, or political conditions.  Information and opinions are as of the date of this material only and are subject to change without notice.  RockCreek has no obligation to provide any updates or changes to such information. The opinions, forecasts, assumptions, estimates, and commentary contained in this material are based on information provided to RockCreek on both a formal and informal basis.  Further, any such opinions, forecasts, assumptions, estimates, and commentary are made only as of the date of this material, are subject to change at any time without prior notice and cannot be guaranteed as accurate.

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