Major North American markets continue grappling with the Ukrainian conflict and the sanctions against Russia. All three major markets were down on the week led by Nasdaq down 3.59% followed by the TSX down 0.36% and the Dow down 0.28%. The US Fed helped dampen the mood with a few bank officials releasing hawkish comments. Many investors see inflationary pressures leading to an acceleration to normalize monetary policy. The prospect of balance sheet deleveraging and more aggressive interest rate increases will likely continue to weigh on markets. Bond yields continue to rise. The 10-year bond rate stands at 2.71% up from 1.97% only a month ago. Will the US Fed be able engineer a soft landing without disrupting the economic momentum?

One investor brushed aside higher rates this past week. The world's wealthiest man, Elon Musk, announced that he has taken a 9.2% stake in Twitter. Shares of the social media platform ended the week up 22%. This could get interesting....

We are watching the ongoing lockdowns in China. Chinese authorities seem committed to slowing Covid spread by locking down big cities like Shanghai and major manufacturing hub Changchun. It's estimated that 23 cities are now under full or partial lockdown as Shanghai alone announced a record 21,000 new Covid cases on Friday. These actions could deal a significant shock to China's vast economy and place more strain on global supply chains as well as further fuel inflation.

World oil prices eased somewhat this past week although North American natural gas prices reached levels not seen in over 12 years. As we've stated recently this is somewhat concerning as it is rare to see strengthening gas prices during this time of year and likely means much higher prices as we get closer to the summer air conditioning electricity demand. Natural gas accounts for roughly 38% of US electricity generation.