China’s economy is slowing. Global supply chain problems may worsen as Shanghai closes

President Putin has signed a law excluding Russian companies from foreign stock exchanges. The law prohibits Russian companies from placing depositary receipts on foreign stock exchanges and obliges them to delist the existing ones.

Russia is still trying to seize Ukrainian territory, shelling peaceful cities and killing civilians. Putin wants to continue the war and is in no hurry to meet with Vladimir Zelensky, Italian Prime Minister Mario Draghi said after a telephone conversation with the Russian president.

Bulgaria and Estonia have banned Russian ships from entering their ports. The ban also applies to ships that changed their flag after February 24. Earlier Italy, Romania, and Belgium closed their ports to Russia.

The oil market is still in a difficult situation. The European Union has begun developing a plan for phasing out Russian energy resources. The EU accounts for 25% of oil and 40% of gas from Russia. Germany consumes the most, receiving 34% of its oil from Russia. It is impossible to replace such volumes in the short term. Everyone understands this, so a step-by-step abolition is needed. The process is also being delayed due to the presidential elections in France, where the second round will take place on April 24. Incumbent President Emmanuel Macron has a better chance of re-election, but his rival Le Pen has a very slight lead. At the same time, Le Pen supports Putin’s policies and intends to withdraw France from NATO if she is elected president.

Asian markets were trading higher last week. Japan’s Nikkei 225 (JP225) added 0.80% for the week, Hong Kong’s Hang Seng (HK50) increased by 0.67% last week, and Australia’s S&P/ASX 200 (AU200) was up +0.59% for the week. China’s GDP rose last quarter, but China’s industrial economic numbers slowed in March due to a severe blow to consumption, real estate, and exports. The labor market is already showing signs of stress in March, which is usually a resilient month. China’s nationwide unemployment rate, which was 5.8% in March (the previous 5.5%), is the highest since May 2020. The biggest short-term challenge for Beijing is the coronavirus-related restrictions amid heightening geopolitical risks that increased pressure on supply and commodity prices. Blocking large cities such as Shanghai is very expensive. The number of ships near Shanghai ports is enormous. Analysts predict a deterioration in the supply chain.

In the commodities market by the end of the week futures on natural gas (+16.61%), Brent oil (+8.64%), WTI oil (+8.43%), orange juice (+8.18%), gasoline (+7.71%), cotton (+6.37%), wheat (+4.21%), silver (+4.16%) and corn (+2.89%) showed the biggest gains at the end of the week. Lumber futures (-7.12%), coffee (-3.61%) and palladium (-3.06%) showed the biggest drop.