After months of higher volatility, markets experienced an almost universally calm session on Friday night. Currencies barely moved, major stock indices shifted less than 1%, commodities were mixed and bonds held recently attained higher ground. The pause followed three weeks of gains for shares, as investors tuned into the company reporting season.

Conflicting market currents could explain the temporary stasis. Major economies around the world face renewed threats from secondary and tertiary Covid-19 outbreaks. Traders balance this concern against the extraordinary support already provided by central banks and governments, and anticipate further measures. The key market question is whether Friday’s lack of action is merely a pause in the ongoing recovery rally, or a turning point for sentiment.

US corporate reporting gets into full swing this week. Around 10% of companies have reported so far, and earnings are running ahead of significantly lowered projections. Higher profile reports include Haliburton, United Airlines, Dow, Twitter, AT&T, E-trade and Verizon. IBM reports tonight, and is expected to report earnings per share of around $2.11.

Trading in the Asia Pacific region is calm this morning. European currencies initially edged lower after European nations failed to reach agreement on a shared debt recovery plan. Futures markets indicate modest opening gains for stocks in Japan, Hong Kong and Australia, and small losses in Singapore and mainland China.

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