Oil and gold performance… The Contrast in global exchanges
Oil and gold performance… The contrast in global exchanges
Oil and gold performance: Markets are witnessing some relative stability,
as they are waiting for Biden’s new plan which will be announced next Thursday.
On the other hand, markets are trying to catch their breath especially after the extreme fluctuations that have occurred in some markets since the start of this year.
Evest is following up performance of various markets today, so as to help you make the right decision at the best time.
A recovery in oil
Oil prices rose today, despite the increased number of Coronavirus infections around the world,
as traders ignored this and focused on hopes for a near economic recovery.
Brent crude futures for March delivery rose by 0.34%, to reach $ 55. 85 a barrel,
while US West Texas Intermediate crude was able to rise 0.42%, to record $ 52.47 a barrel.
Oil had declined yesterday at the start of the week’s sessions,
as countries’ taking more stringent measures regarding health and epidemiological situation affected the performance of the oil.
All these new concerns have faded despite China’s closure of large parts of the country and Japan’s consideration of tighter health measures.
Sentiment remains high after the Kingdom of Saudi Arabia decided to reduce
its oil production by one million barrels a day during next February and March,
on a voluntary basis so as to support prices.
Organization of Petroleum Exporting Countries and its allies OPEC + have agreed to stabilize production but they will increase it to Russia and Kazakhstan by only 75. 000 barrels a day.
Joe Biden intends to present his plans for great stimuli next Thursday in order to provide relief,
support checks, increase direct payments to Americans, and other measures that can limit the consequences of Coronavirus.
All this supported prices to trade at their highest levels in nearly a year.
This was precisely before prices witnessed violent and sharp fluctuations to bottom with the largest sharp drop in prices since 1991 which witnessed the same time of the Gulf War.
Coronavirus and restrictions of movement and travel have significantly hit demand for oil,
which by its turn caused oversupply with the death of demand. This made prices plummet.
Gold performs positively
Gold was able to rise today after it witnessed a significant decline yesterday
as it took benefit from the continuing increase in numbers of Coronavirus infections
around the world in addition to a decline in the stock market.
Gold rose by more than 1%, as an ounce recorded $ 1860 at the time of publication.
The precious commodity fell by 0.2% to reach $ 1847 an ounce on Monday.
Today, it seems that the market ignored the high yields of US Treasury bonds in addition to the recent recovery in US currency as gold rose by more than $13 in just a few hours.
This means that there is a possibility to reap more gains through coming hours,
especially as it witnessed a successive rise through all trading hours.
The increasing number of infections of Coronavirus Covid-19 around the world affected the sentiment of near economic recovery,
which supported gold as investors believe that vaccines will not bear fruit in the near term especially there are more than 90 million cases of infections around the world, according to Reuter.
On the other hand, Democrats want to isolate US President Donald Trump after riots by his supporters
at the Capitol building last week which was a direct instigation of the outgoing president.
All these supported markets and the picture remained positive for gold as it tries
to persist what it reached to especially over the level of $1860.
On the other side, trading should be cautious, since the US dollar is witnessing a strong recovery since the end of last week.
This may make gold decline again, as the rise of the dollar adversely affects gold.
Mixed trades in World Stock Exchanges
In the stocks market, Asian indices witnessed mixed trading as the Shanghai Stock Exchange,
Tokyo and Hong Kong have risen while Sydney, Seoul, and South East Asia markets fell.
Shanghai Composite Index rose by 1.4%, to trade at 3580.95 points.
Hong Kong’s Hang Seng Index rose by 0.8%, to reach about 28.117.37 points,
while the Japanese Nikkei index rose by 0.1%, recording 28.164.34 points.
KOSpI Index in Seoul declined by recording 3125. 72 points after losing 0.8%,
of its value. Australian S&P-ASK 200 index fell by 0.3% to reach 6. 679.10 points,
while the Indian Sensex fell by 0.1% recording 49.214.12 points.
On Wall Street, markets declined overnight after a series of record gains.
Standard & Poor’s 500 indexes fell by 0.7% to reach 3.799.61 points breaking the series of gains that lasted for 4 sessions in a row.
As for, Dow Jones Industrial Average, it retreated by about 0.3% recording 31.008.69 points,
while the Nasdaq Composite Index declined by 1.3%, recording 13.036.43 points.
Stock prices in London are expected to open slightly higher on Tuesday as investors put the growing cases
of Coronavirus and potential for additional fiscal stimulus in the US into consideration,
especially after the opposition of Democrats stormed Congress.
According to IG data, European markets are expected to open higher as the British FTSE index may gain 11.92 points
at the opening to trade at 6.810.40 points after rising by 1.1%, to 74.78 points on Monday.
Markets were affected by statements of British Health Minister Matt Hancock,
who said that there were approximately 2.3 million people have received the first dose of Coronavirus vaccines,
while 388.677 of people have received the second dose.
According to a plan drawn by UK authorities,
it is assumed that 15 million of those people who have the most risk of the virus, will be vaccinated by mid of February.
The dollar is falling again, not
Evest is following movements of forex markets today,
as the US dollar resumed its decline today against a basket of major currencies.
Euro rose against the US dollar by 0.13%, to record 1.216.8.
Sterling rose by 0.40%, to reach 1.3561, while the Australian dollar rose by 0.37%, registering 0.7728.
The New Zealand Dollar rose by 0.39%, to reach 0.7191.
The dollar fell against the Japanese yen by 0.07%,
to trade at 104.13 and it fell also against the Chinese Yuan by 0.24%, to record 6.4647.