To The Moon

Global stocks fell on Thursday as investors sold risky assets due to concerns about possible recession and the Russian-Ukranian war. 

• U.S. Stocks Market - The worst Q1 start since 2009, in March we saw third-biggest bearish rally since The bankruptcy of Lehman Brothers in 2008

• Global Bond Markets - The worst Q1 performance since record

• U.S. Treasuries - The worst Q1 performance since the American Civil War

• U.S. Treasury Yield Curve - Shows an inversion signifying a recession

• Commodities - poised for the best quarterly performance in 32 years

• International Oil Prices - the strongest Q1 start since 1999

• U.S. Gasoline - Fastest rise ever, Hit record high

• London Nickel Price - Unprecedented one-day doubling leads to deal cancellations

$S&P 500(.SPX)$ ,$Dow Jones Stoxx(DJXMF)$ $NGmain(NGmain)$ $CLmain(CLmain)$ $NASDAQ(.IXIC)$ $NASDAQ 100(NDX)$

The following charts will help investors review the specific performances of global markets in the first quarter:

1. Stock Market

Although global stock markets generally rebounded in the second half of March, the stock indexes of major economies are still difficult to escape the fate of falling. As of the end of the first quarter, the S&P 500 fell 4.3%, the pan-European Stoxx 600 fell 6.5%, and the Shanghai Composite fell more than 10% in three months.On the U.S. stock market, the Dow Jones Transportation Average ended the first quarter almost flat where it started the year, while the Nasdaq Composite fell about 8% in the first quarter despite a sharp rise in March. It was the index's second-worst start to a start since 2008 (after the start of the Covid-19 outbreak in 2020).In terms of the magnitude of the rebound, after bottoming in mid-March, the Nasdaq has rallied a staggering 17% in just 10 days, while the S&P 500 has risen nearly 12% over the same period.From the perspective of specific industry sectors, energy stocks were the biggest winners in the US stock market in the first quarter, while utilities stocks were the only other sectors that rose. In contrast, consumer discretionary and technology stocks were the worst performers in the quarter.Meanwhile, value stocks generally outperformed growth stocks in the first quarter, but growth stocks are starting to buck the trend in the near term after relative performance hit its highest point since May 2021 in March.FANG+, a group of large tech stocks, rebounded sharply in late March, but still closed the first quarter lower.

2. Global Bond Markets

The bond market have fallen all the way in the first quarter. Thursday marked the official end of the first quarter, just as the global bond market just suffered its biggest quarterly drop on record, according to data compiled by Bloomberg.In terms of U.S. bonds,according to statistics from Jim Reid, head of special research at Deutsche Bank,the 10-year U.S. Treasury recorded one of the worst quarterly performances in total returns in the past 157 years (since the American Civil War),In the Q1, 2022, 2-year U.S. Treasury yields surged 156 basis points, the largest quarterly gain in nearly 40 years.In contrast, the rise in long-term bond yields, while impressive historically, is still far less impressive: 30-year yields are up "only" 55 basis points.This directly caused the key 2-year/10-year Treasury yield curve to invert at the end of March. This inversion of the yield curve is often seen by the industry as a reliable indicator of a recession in the U.S. economy within one to two years.At present, U.S. bond yields have finally caught up with Gundlach’s favorite forward-looking indicator (copper/gold ratio):Seasonally speaking, before the trend really turns bullish on bonds (the chart below shows the typical seasonal pattern of 10-year U.S. Treasury yields since 1962), we may see more pain in the bond market...Logically, the series of sell-offs and inversions of U.S. bonds are not unrelated to the market’s interest rate expectations from the Federal Reserve.At present, the interest rate swap market expects the Fed to raise interest rates by 25 basis points nine times this year, and may cut interest rates three times in the next two years!

3. Forex Market

In FX markets, the Bloomberg Dollar Index was higher in the first quarter (up in January and March, down in February), returning to its pre-COVID-19 range and now at its highest monthly close since July 2020… …The most dramatic change in the foreign exchange market in Q1 undoubtedly appeared in the ruble, the protagonist of the conflict between Russia and Ukraine. Due to the Western sanctions against Russia, the Russian ruble fell to a low of nearly 140 rubles against the US dollar in early March, but now it has returned to the 80 before the outbreak of the Russian-Ukrainian conflict under a series of measures to support the exchange rate from Russia. level near the pass.

In Moscow, the ruble has risen in 15 of the past 16 sessions.In addition, the safe-haven Japanese yen unexpectedly tumbled in Q1. The dollar rose to a more than six-year high against the yen as the Bank of Japan, which insists on an accommodative stance, and the Federal Reserve, which has already stepped into interest rate hikes, widened the policy differences, and the yen led the decline of G10 currencies in the first quarter.

4. Cryptocurrencies

Cryptocurrencies also had a tough first quarter, with Ethereum down more than 10% while Bitcoin fell just 1% in the quarter.

5. Commodities

In the commodity market, all major commodity categories rose in the first quarter, with the Bloomberg Commodity Spot Index having its best start on record, surging 26% in the first quarter.For many investors, the performance of oil prices has undoubtedly been the most watched, with U.S. WTI crude up around 40% (the best start to a year for oil prices since 1999).Copper prices and gold rose about 6% in the first quarter, which was also gold's best start to the year since 2016...Aluminium futures on the London Metal Exchange (LME) ended lower on Thursday but were still on track for their biggest quarterly gain since 1988.Of course, the most impressive part of the metal market in the first quarter is undoubtedly the "demon nickel".

LME nickel futures surged by about 55% this quarter, the largest quarterly increase since 2009. Due to a short squeeze in the LME this month, nickel prices soaring.U.S. retail gasoline prices hit a record high in the first quarter as crude prices surged.U.S. natural gas prices are also off to their best start since 1990, with European gas rising even more astonishingly.In any case, in this first quarter when commodities are king and stocks and bonds are double-killing, concerns about the possibility of "stagflation" are sweeping the world.Looking ahead to the second quarter, the only consensus on Wall Street so far is that inflation will not subside anytime soon, with many warning that market liquidity and trading conditions could become more challenging.