Push for gold and oil, and stock markets, dollar suffers alone

Oil News

Push for gold and oil, and stock markets, dollar suffers alone on the day of Biden’s inauguration

push for gold and oil, and stock markets, dollar suffers alone;

Market participants are looking forward to the inauguration of President-elect Joe Biden later today,
looking for clues about his agenda priorities during his first 100 days at White House,
while extensive security measures have been taken for preventing any potential violence or disturbances by Trump and his supporters.


Investors will be watching any blame Biden may make about a $ 1.9 trillion relief plan after
Janet Yellen announced support for increasing spending on aids concerning Coronavirus Covid-19.


Oil finds support and continues its rising

Standard crude prices continued to rise in today’s trading as traders are awaiting US inventories reports amid optimism due to the stimulus package.


Brent crude futures rose to $ 56.21 a barrel. This is $ 0.31 higher and records about 0.55% higher than the close of the previous session’s price.

Brent crude futures also rose by $ 1.15 at a rate of 2.1% to reach $ 55.9 a barrel.


The price of US West Texas Intermediate crude futures for March in electronic trading on the New York Mercantile Exchange
was $ 53.32 a barrel which is $ 0.34 recording a rate of 0.64%, higher than the previous trading level.

On Tuesday, the price of crude rose by $ 0.56 to record 1.1%, to reach $ 52.98 a barrel.


According to MarketWatch, oil prices are near their multi-month highs even as large downside risks remain.


The International Energy Agency lowered its forecast for oil demand growth in 2021 by 280.000 barrels a day to reach 5.5 million barrels a day.


It will take longer for oil demand to fully recover as renewed lockdowns in a number of countries put pressure on fuel sales.


This has led to a revision of global demand expectations for oil by 0.6 million barrels a day during the first quarter of 2021,
and at a rate of 0.3 million barrels a day as a whole for 2021.

Drop-in demand during the first quarter of the year is due to an increase in the number of Coronavirus Covid-19 cases in most of the United States and Europe,
as well as calls in China to limit travel in the Lunar New Year.


Meanwhile, analysts suggest that the weakness of the US dollar may support commodity prices.

ICE index which tracks the dollar’s dynamics against 6 currencies such as (Euro, Swiss Franc, Yen, Canadian dollar, Sterling, and Swedish Krona)
has lost 0.1% during today’s trading session.


Markets are also supported by expectations of a new economic stimulus in the United States.

On Tuesday, Speaking at a Senate Finance Committee, Janet Yellen, former Federal Reserve chairperson nominated
by President-elect Joe Biden as Treasury Secretary, urged lawmakers to “act aggressively” to stave off a prolonged economic recession.


Gold is rising for the third session in a row

Gold prices rose today for the third session in a row, as US dollar and US Treasury yields retreated, by its turn led to supporting Yellow Metal.


In instant trades, gold rose by 0.6%, to trade at $ 1850.66 an ounce,
while futures contracts of the precious metal rose by 0.5%, to record $ 1850 an ounce.


Yesterday watched Biden Treasury nominee, Janet Yellen’s speech at the Senate hearing session,
as she asked for boosting market confidence by showing support for the massive $ 1.9 trillion stimulus package recently announced by President-elect Joe Biden.


Yellen’s comments raised hopes of an early stimulus, which may lead to an economic contraction.

Risky assets rose along with gold prices, according to these comments.


A large stimulus package means that inflation will definitely increase.

This will lead to a decrease in real returns and support for gold, especially since traders consider yellow metal as a hedge against inflation,
as its value always rises in times of economic inflation which leads to resorting to it as a store of value.


At the same time, gold is experiencing some pressure, as calls are increasing for faster distribution of Covid-19 vaccines which by its turn will give hopes for economic recovery.

This puts pressure on the precious metal.


Large gains in stock markets

Yesterday, Wall Street began its new trading week after a long weekend celebrating Martin Luther King, s Day.


Markets recovered from most of last week’s losses as Standard & Poor’s 500 index rose by 0.8%,
to trade at 3,798.91 points, to be only 1%, from its highest level recorded this month.


The Dow Jones Industrial Average rose by 0.4%, or 116 to trade at 30,930.52 points while
the Nasdaq index increased by 1.5%, or 198 to trade at 13,197.18 points.


In Europe, IG expects European stocks to open higher trading today,
as traders are awaiting Biden’s official inauguration today.


According to expectations, the British FTSE Index may rise by 22 to reach 6799 points,
while the German DAX index may gain 9 to trade at 13830 points and the French CAC Index may rise by 4 to trade at 5605 points.

In addition to the Italian FTSE MIP index gaining 63 points.


In Asia, main indices collectively rose except for Nikkei which appeared to be affected by recent strict measures to limit the spread of Coronavirus Covid-19.


Japanese Nikkei Index declined by 0.38%, to trade at 28529 points while the Hang Seng Index rose by 0.94%, to trade at 29,920 points.

The Shenzhen Index rose by 1.46%, to trade at 15223 points, while S&P /ASX 200 rose by 0.41%,
to trade at 6770 but Kospi rose by 0.71%, to trade at 3114 points.


US dollar is weak

The US dollar fell today against a basket of major currencies and Euro rose against American
currency by 0.2%, to trade at 1.2153 points, while the Sterling settled at 1.3668 points.

Australian and New Zealand dollars gained 0.6%, and 0.3%, in a row to trade at 0.7737 and 0.7142.

The US dollar fell against the Japanese Yen by 0.13% to trade at 103.74 points.

The US dollar also fell against the Chinese Yuan by 0.17% to trade at 6.4662.


push for gold and oil