Summary:
- Oil sinks in spite of the extension of OPEC output cut agreement
- GBP dips after comments from BoE Governor Carney
- European and Asian equities finished the day higher, Wall Street turns negative
Equities in Asia extended yesterday’s rally during today’s session. The biggest gains were spotted on the Chinese stock market while shares from Japan and Australia posted just minor gains. Trump’s threat to target additional EU goods with tariffs exerted some pressure on the European stock indices and caused them to trade below yesterday’s closing price for the major part of the session. Nevertheless, moods improved following interview of Peter Navarro with CNBC. White House adviser said that US-China talks are heading in a very good direction.
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Open account Try demo Download mobile app Download mobile appWhile Navarro’s remarks lifted equities a bit, they did little to ease concerns over global demand for oil. Both grades of oil are trading significantly lower today. Oil traders do not seem to be appealed by the extension of the OPEC output cut agreement that was officially announced today. However, it was rumoured for some time that oil producers will roll over the deal and, in turn, such a development was already priced in. Declines can be spotted on almost every actively traded commodity. Precious metals as a group are an exception here with gold, silver and palladium showing decent gains.
Moving onto the FX market, US dollar is giving back some of yesterday's gains as potential for escalation of the US-EU conflict reminds investors of ever present trade tensions. The British pound is the only G10 currency that is trading lower against the USD at press time. Pound is being pressured by comments from BoE Governor, Mark Carney. Carney said that trade tensions increase risks for the global economy - a remark that hinted the BoE may turn more dovish soon. In spite of a rate cut delivered over the night by the Reserve Bank of Australia, AUD can be found among the best performing G10 currencies today.
The bulk of major cryptocurrencies trade slightly higher on the day. Nevertheless, the gains are insignificant compared to the recent slump. Bitcoin hovers close to the $10.5k mark while Ripple trades slightly below the $0.40 handle.
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