Stock rally fizzled after 4 days of gains in the U.S. and Europe and crude oil prices rebounded $2 a barrel on both coasts of Atlantic. European Union is preparing to impose additional stringent sanctions on Russian individuals and corporations and emergency arrangements for natural gas supply interruptions. Bond market yields also signal more economic pain ahead.
Citigroup agreed to sell its retail banking, wealth management unit, credit card business, and back office operations for $1.6 billion. The lender will continue its institutional business as a part of plan to exit from 13 countries announced previously. Axis Bank will acquire 3 million new customers, 21 branches, and 3,600 employees in a deal that is expected to close in a year.
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U.S. stock indexes traded sideways and tech stocks rebounded from the morning doldrums. U.S. bond yields were in focus after 5-year bonds traded at 2.56%, 10-year at 2.46%, and 30-year yield at 2.54%. The ever tightening and rising yields are reflecting growing acceptance of larger rate increases in the coming months.
U.S. indexes turned lower and gave up early gains on the growing worries that the fast rising crude oil and commodities prices are contributing to the latest bout of inflation. Fed is lagging considerably as real rates expands further in negative territory.