Equity Indices

The Nikkei ended the week lower following weaker than expected results of a new 10-year government bond auction.  Britain's FTSE 100 reached over 4 month highs, getting a boost from commodity stocks.

U.S. stocks  extended their recent rally, led by gains in energy shares and oil prices, while higher-than-expected January car sales added to the upbeat tone. The S&P 500 recorded a recent recovery after suffering its biggest monthly drop in a year in January, but the index remains locked in its trading range of only about 120 points since mid-December. The year so far has    been marked by days of high volatility, with the S&P 500's trading range often more than double its average over the past year.

Interest Rates

 Benchmark Bond Yields

The Treasury on Tuesday accepted 8 million in 91-day Treasury bills at an average yield of 0.03% and 12 million in 182-day Treasury bills at an average yield of 0.042%. Outstanding Treasury Bills now amount to Euro 216,540,000 - an increase of Euro 8 million from the previous week.

Greek plans to swap government debt for bonds with interest payments linked to economic growth got a sceptical reception from euro zone officials as new Prime Minister Alexis Tsipras sought support for his proposals in Europe. Greece's finance minister on Monday floated the idea that Greek bonds held by the European Central Bank and part of the debt owed to euro zone governments, 53 billion euros of bilateral loans, could be swapped for either growth-linked, or perpetual bonds.

New orders for U.S. factory goods fell for a fifth straight month in December, but a smaller-than-previously reported drop in business spending plans supported views of a rebound in the months ahead. Other data showing fairly brisk sales in January by the country's leading automobile manufactures also offered a silver lining for a sector that has taken a hit from weak global demand and falling crude oil prices.

Forex

The dollar, suffered its biggest one-day fall in over a year as it came under pressure from many fronts amid oil-fuelled gains by commodity currencies.  Buyers snapped up commodity currencies as the oil market extended its recovery and copper prices also surged.  Elsewhere in the market, the euro recovered on hopes that Greece may yet secure a new debt deal.

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