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A new drop for gold

A new drop for gold and positive trading for American and Asian stock exchanges

A new drop for gold and positive trading for American and Asian stock exchanges

A new drop for gold and positive trading: Signs of global economic recovery are becoming evident.

Yesterday, German GDP growth improved in the last quarter of the year.

German Statistical Office improved GDP growth of the fourth quarter in its initial estimate from 0.1% to 0.3%,
indicating that this is considered among positive effects of household consumption and growth of exports.

This was the biggest supporter of European exchanges in Wednesday’s trading.

It seems that this matter will continue during this session as well.

Every day, Evest is following up on developments in global markets so as to help you keep track of the most important influences of trading.

 

Brent crude oil is positive… West Texas Intermediate crude is negative

Today, for the fourth consecutive session oil prices rose to record their highest levels in more than a year and a month,
supported by monetary easing policies and a decrease in United States’ crude production.

Brent crude oil - خام برنت قد ارتفع

Brent crude has risen – image is for illustration only – 12:30 Dubai time – 2/25/2021 – Evest Web TraderTrade from the browser

 

Prices of Brent crude futures for April rose to $ 67.33 a barrel on ICE London Futures Exchange.

Brent crude was up by $ 1.67 or 2.6% to record $ 67.04 yesterday. They are the highest levels since the start of January 2020.

On the contrary, West Texas Intermediate futures prices for April were down by $ 0.04 or 0.06% to record $ 63.26 a barrel on New York Mercantile Exchange.

Although, WTI added $ 1.55 or 2.5% yesterday and reached its highest level since January 6 of last year to record $ 63.22 a barrel.

On other hand, Yesterday, the US Department of Energy reported that oil reserves in the country increased by 1.28 million barrels during a week.

 

Bloomberg

While Bloomberg had expected a decrease in inventories by 6.5 million barrels, analysts at S&P Global Platts expected a decline of about 4.8 million barrels.

In addition, mobility indicators increased in the largest five economies in the region- Great Britain, Germany, Spain, Italy, and France.

This recently confirms recovery in oil demand and supports prices.

 

Investors

Investors also resorted to oil after Federal Reserve Chairman confirmed that remaining interest rates low made them take risks.

In his speech the day before yesterday, Powell said that the monetary policy of the bank should remain accessible.

This made sentiments higher.

For its part, Energy Information Administration announced that extremely cold weather in Texas had caused a decrease in production
in-country by more than 10 %, which amounts to one million barrels a day during last week.

This means that oil inventories which will be announced next week will be closer to reduce.

Market participants are waiting for a meeting of OPEC and its allies on next March 4, so as to discuss production mechanisms during the next 2 months.

It is expected that organization will slightly ease restrictions on the supply of oil,
especially with the recent recovery in prices as they have increased by nearly $10
since the decision of the Kingdom of Saudi Arabia to voluntarily decrease its production during February and March.

 

Gold is retreating as US Treasury yields are rising

Today morning, the price of gold has appeared to be low as gold futures for April delivery declined by $ 4.50 to record $1.793.30 an ounce.

US 10-year Treasury yields have made a return of more than 1.42%. This is its highest level in more than 12 months.

 

This has helped the dollar index which compares American currency to another 6 currencies but it remains miles away from its highest level in 12 months.

 

However, a decrease in risk rates may have an adverse effect on the prices of gold.

More risky asset classes such as stocks or Bitcoin have recently become significantly more expensive, and the need for protection has been diminished.

Gold prices may witness new momentum in the afternoon, when the latest figures on durable goods orders, GDP growth,
and initial weekly claims for US unemployment benefits are released.

 

Asian stock Exchanges are recovering from yesterday’s losses

 

Today, Asian stock markets recovered from yesterday’s losses.

The leading Japanese Nikkei 225 index rose by 1.67% to record 30168 points.

CSI-300 index which includes the top 300 companies listed on mainland China stock exchanges has recently risen by about half a percent.

In Hong Kong, Hang Seng rose by 1.5%.

 

DAX index may set new records

Today, the German DAX index is expected to make a strong start as an IG broker,
the German benchmark was estimated by a rise of 0.64% to record 14,065 points,
at an hour and a half before the beginning of trading.

 

This record number of 14,169 points set on February 8, is put in hand after DAX had been declined to 13,664 points on Tuesday.

Strong volatility is considered a sign of investor’s hard tension.

Bulls and bears are currently competing for where to head after sideways action during the last few weeks.

 

Positive trading for American stock exchanges

The rising of oil prices, unexpectedly good data from the US real state market, and positive comments
by US Federal Reserve Chairman Jerome Powell led to a rise in US stock markets on Wednesday.

 

Dow Jones Industrial Average which was initially still in the red area, rose above the barrier of 32,000 points.

It rose to another high record of below 32,010 points.

In the United States, the main index was able to close up 1.35% to record 31,961.86 points.

 

Standard and Poor’s 500 indexes closed at the market level, rising by 1.14% to reach 3,925.43 points.

Nasdaq 100 technology index which had been put under pressure during the last days of trading,
rose by 0.81% to record 13,302.19 points.

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