Gold Tops $1300 As Russian Rumblings Stumble Stocks

Bonds, Gold, and JPY are bid this morning as US equity futures are fading fast. The Dow and S&P futures are now back below pre-AAPL/FB levels and Nasdaq futures falling fast. Gold is back above $1300 (up over $30 from yesterday's pre-Putin lows). Treasuries, led by the long-end, are rallying as safe-haven bids appear across the whole complex. 30Y yields are down to 3.53 - the lowest since July. JPY is bid once again as USDJPY tests back to the crucial 102 level.

First, a quick bulletin summary of the key overnight events:

• Treasuries rise, with 10Y and 30Y leading weekly gains amid increasing tensions in Ukraine; Russia’s military began new exercises on the countries’ border as S&P cut Russia’s sovereign rating to BBB-.
• Russia’s central bank unexpectedly raised its one-week auction rate to 7.5% from 7%; U.S. secretary of state Kerry warned Putin he’s running out of time to comply with an accord to ease tensions
• Obama said the U.S. and its allies “will follow through” on additional sanctions if there is no progress; plans to call European leaders today to discuss options
• Merkel spokesman Steffen Seibert said Russia’s actions in eastern Ukraine are “absolutely disappointing”
• Israel said it will suspend Middle East peace talks because of the Palestinian Authority’s reconciliation agreement with Hamas; Obama said no Middle East deal expected in next six months
• EU officials are preparing to pit the bloc’s banks against the toughest simulated recession that they have ever faced in a stress test, three people briefed on the matter said
• U.K. retail sales rose 0.1% in March, more than expected, as warm weather boosted spending on spring clothing
• A drunk passenger on board a Virgin Australia Holdings Ltd. plane destined for Bali, Indonesia, caused a hijack scare after trying to enter the cockpit
• Sovereign yields mostly lower. Asian stocks ex-Japan mostly lower; Nikkei +0.4%, Shanghai -1.00%. European equity markets fall; U.S. stock futures slightly higher. WTI crude and copper lower, gold gains

Dow and S&P futures are well below pre-AAPL/FB levels...

As Gold breaks above $1300

As the 30Y yield drops to new 9-month lows...

Critical for the open is USDJPY holds 102...

The remainder of the overnight events courtesy of RanSquawk:

Asian Headlines

Japanese National CPI and the forward-looking Tokyo CPI missed expectations despite the Y/Y coming in at its highest level since 1992, with some analysts noting that inflation above 3.0% could lead to further easing by the BoJ at their meeting next week . Whilst Asian stocks closed mostly lower (Hang Seng Index -1.5%, Shanghai Composite -1.0%), but the Nikkei 225 (+0.17%) was somewhat shielded from losses amid a series of positive earning reports.

Ukraine/Russia

The Russian Micex traded lower at the start of the session after Russia was cut by S&P from BBB to BBB-. However, losses were trimmed after Russian foreign minister Lavrov said Russia will push to de-escalate the Ukraine conflict despite accusing US Secretary of State Kerry of using a prosecutorial tone. This was later followed by reports of a Ukraine helicopter damaged after shot by a sniper and comments from Russian President Putin saying Russia should increase production of anti-missile systems.

EU & UK Headlines

Fitch affirmed Italy at BBB+; revised outlook to stable from negative. Separately, S&P affirmed France and the EFSF at AA; outlook stable. (BBG/RTRS)
Barclays preliminary pan-Euro agg month-end extensions for April: +0.09y (March +0.07y)
Barclays preliminary Sterling month-end extensions for April: +0.02y (March -0.02y)

US Headlines

Attention turns to further US earnings from Ford and AbbVie, with US PMIs and University of Michigan data to shed more light on US economic confidence, which was dampened this morning after Goldman Sachs slashed their GDP estimate for Q1 to just 1.0% from 1.4% prior saying they expect Q1 to be the lowest point of the year for growth, with substantial weather effects and inventory drag weighing on growth.
Barclays preliminary US Tsys month-end extensions for April:+0.08y (March +0.07y)

Equities

European equities started Friday's session on a lacklustre note (Eurostoxx 50 currently -0.69%) as overhanging fears of escalation in Ukraine kept riskier assets under pressure, taking the shine out of further M&A chatter for Shire and Tate & Lyle today.

FX

GBP strengthened as retail sales beat expectations, but the moves were relatively muted given the touted weather effect on the numbers. The JPY trades higher on the back of flight to quality, as markets looked beyond lower than expected CPI overnight. Note there are USD 2.5bln worth of option expiries in USD/JPY to roll off at 1000am NYcut (1500BST).

Commodities

WTI has been offered since the European open now touching Wednesdays lows with little support seen until USD 100.00/100.39. This follows on from a strong session yesterday after flared tension in Ukraine supported WTI. Reports emerging of Russian Military mobilization and Ukraine giving Russia a 48 hour deadline to "explain" their movements. Bank of America says that WTI price has decoupled from Brent and time-spreads. (BBG)