The main story in the markets today is the fallout from yesterday’s Doha meeting, where a failure to agree on the terms for a production freeze involving OPEC and non-OPEC countries saw crude open sharply lower. However after shedding as much as 6% from Friday’s close on the open, the market has recovered well and now isn’t too far from ending the day level.
A strike of workers at oil refineries in Kuwait has been partly attributed to the recovery, but in truth it appears more a case of an over reaction to the news and sharp gap lower. The only economic data released this afternoon of note was the foreign securities purchases from Canada which came in much better than expected. Fed member William Dudley has been speaking in New York this afternoon and comments stating that the "labour market conditions have significantly improved" were surprisingly hawkish. We also earlier posted our weekly technical analysis overview covering some of the most interesting setups on currency pairs and indices at present.
European indices have shrugged off a poor start to end their cash session’s in the green with the Dax (+0.79%) trading 10150. The Eurostoxx 50 (+0.57%) has also reacted impressively to early weakness, whilst the FTSE (+0.19%) is also back in the green. The US500 (+0.42%) has touched fresh highs in the past hour of 2083, eclipsing last week’s top which was also the highest level of the year.
The turnaround seen in Crude benchmarks is pretty incredible even by their volatile standards, with Brent Oil (-0.30%) almost back to flat on the day and more than 200 ticks of it’s lows! Gold (+0.09%) and Silver (+0.09%) are slightly higher, but both precious metals are little changed on the day.
There’s been some fairly large moves int he currency space with the AUDUSD (+1.11%) and NZDUSD (+0.77%) showing the strength in the antipodean currencies. The Pound has gained today, despite George Osborne’s comments relating to the dangers that a Brexit could entail for the UK economy. The GBPUSD (+0.62%) has followed the same path as oil and stocks in reversing earlier losses to trade near the 1.43 handle for the first time in a week.
Looking forward overnight there’s the release of the minutes from the RBA meeting before German Zew Economic Sentiment is announced at 10:00 which could be particularly important ahead of the EB meeting on Thursday. US Building permits are released at 13:00 tomorrow afternoon before we have central bank speeches from Stevens, Carney and Poloz at 14:30, 15:35 and 16:00 respectively.
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