UK GOVTS – New virus strains, US politics and Japan holiday to support

By Stephen Bough

LONDON, January 11 (IFR) – Risk appetite is very low to start the week. Virus fears remain elevated as Japan and the US report new strains of Covid, similar to the highly infectious strains impacting the UK and South Africa. Political tensions are high in the US and as the Democrats look to impeach President Donald Trump for the second time. Volumes are also contained with Japan enjoying a long weekend for the Coming of Age Day. We look for Gilts to start the week on a firmer footing. 10-year cash yield support is from Friday’s lows of 0.278%. Resistance is from Friday’s high of 0.303%.

Judging by the early price action from core fixed income markets Gilts should open 5 to 10 ticks higher than the settlement of 134.37. Resistance is from Friday’s highs of 134.59. Support is from Friday’s low of 134.26.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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