The Fed had a key role

Oil Red Zone stock indices

The Fed had a key role and American companies announce their fourth quarter financial results

The Fed had a key role and American companies announce their fourth-quarter financial results: Yesterday, oil jumped to new highs, close to $90 per barrel, amid a wave of geopolitical tensions in both Europe and the Middle East.

Evest follows market developments in the following report.


The Federal meeting had a key role and stock indices are in the Red Zone

Fourth quarter financial firm results move the stock market

Oil declines after yesterday’s sharp rally

Further increase in oil demand

Geopolitical tensions disrupt the oil rally



The Federal meeting had a key role and stock indices are in the Red Zone

US stock indices ended Tuesday’s trading lower, with traders focusing on a two-day meeting of the Federal Reserve System.

The Dow Jones Industrial Index fell by 66.77 points (0.19%) by the end of Tuesday’s trading to 34,297.73 points.

The Standard & Poor’s 500 fell by 53.68 points (1.22%) to 4356.45. The Nasdaq Composite Index lost 315.83 points (2.28%) to 13539.29.

Analysts believe the Fed may give markets a signal that it is ready to start raising interest rates in March,
following the results of the January meeting, which ends on Wednesday.

This will be the first price rise since 2018.

The easing of monetary policy was caused by the Covid-19 pandemic.

But now the Fed may also be looking at other options to tighten monetary policy to combat rising inflation, according to CNBC.

A growing number of Federal Reserve Board officials and Wall Street economists, see the possibility of the US Central Bank increasing its prime interest rate ,
more than threefold this year against the backdrop of soaring consumer prices.

They interpret these projections as indications that inflation in the United States, which has reached a maximum of nearly 40 years,
affects all sectors of the economy, while the labor market is growing rapidly.

In the meantime, US consumer confidence declined to 113.8 in January from the revised 115.2 the previous month,
according to the Conference Board, a research organization that calculates the index.

Analysts predicted an average drop of 111.8 points from the level previously announced in December of 115.8 points,
according to Trading Economics data. 

Market participants also follow the publication of American corporate reports.


Fourth quarter financial firm results move the stock market

AmEx, one of the leading companies in the US plastic card market,
provided better than expected financial results in the fourth quarter of standard card spending.

The company’s securities price rose by 8.9%

Raytheon Technologies’ stock price rose 2.5%.

The company increased its net profit in the fourth quarter by more than 5 times,

but the current year’s income and expectations were lower than that of the experts.

Haliburton’s shares rose by 7%, with the Oil Field Services Company’s fourth-quarter financial statements exceeding market expectations.

US telephone company Verizon Communications Inc increased adjusted profits above market expectations in the fourth quarter of 2021,
and revenue fell slightly to be in line with expectations.

The company’s stock fell by 0.11%.

General Electric’s stock prices fell by 5.98%.

The company reported a net loss of $3.84 billion, or $3.55 per stock, in the fourth quarter of 2021,
compared to a net profit of $2.64 billion, or $2.2 per stock, for the same period a year earlier.

Johnson & Johnson’s stock rose by 2.86%.

The world’s largest health manufacturer nearly tripled its net profit in the fourth quarter of 2021,
with revenues of 10.4%. But the last figure fell short of market expectations.

Oil declines after yesterday’s sharp rally

Oil prices fell on Wednesday after a big jump the day before, and the market watches the situation across Ukraine ,
and awaits a weekly report from the Department of Energy on US energy reserves.

The American Petroleum Institute (API) reported on January 25 that U.S. oil inventories declined by 872 thousand barrels last week after rising by 1.404 million barrels a week ago.

The U.S. Department of Energy will publish its statistics later on Wednesday. 

Experts surveyed by Standard & Poor’s Global Platts predicted that the country’s oil reserves declined by an average of 2.1 million barrels last week,
gasoline stocks increased by an average of 2.2 million barrels, and distillates declined by an average of 1.6 million barrels.

Brent crude futures for March fell by $0.2 (0.23%) on the London Futures Exchange, to $88 per barrel.

Brent rose by $1.93 (2.2 percent) to $88.2 per barrel on Tuesday.

The March futures price for West Texas Intermediate crude at the time was lower in electronic trading on the New York Mercantile Exchange (NYMEX) by $0.34 (0.4%),
to $85.26 per barrel.

Further increase in oil demand

During the previous session, the futures contract rose by $2.29 (2.8%) to $85.6 per barrel.

Oil market volatility increased this week, with prices falling more than 2% on Monday and rising by more than 2% on Tuesday.

However, they are still near 7-year highs.

Most experts expect a further increase in oil demand, and a number of investment banks,
including Goldman Sachs, expect Brent to rise to $100 per barrel this year, Bloomberg notes.

Data on strong oil demand in India, the world’s third-largest consumer of this fuel, has led investors to be optimistic.

Indian imports reached the annual maximum in December: Deliveries increased by 7.1% compared to November (up to 19.65 million tons),
compared to pre-pandemic in December 2019, and growth was 5%.


Geopolitical tensions disrupt the oil rally

Earlier, it became known that NATO armed forces are preparing their forces and sending additional ships and fighter aircraft to Eastern Europe to build up Russian forces near Ukraine. 

Besides, Yemeni Houthi rebels fired two ballistic missiles into Abu Dhabi and managed to penetrate the United Arab Emirates Air Defense Forces.

In response, UAE forces destroyed the site from which the raid was launched, Al Arabiya TV reported, citing the UAE Ministry of Defense.

On Tuesday, US State Department spokesman, Ned Price, said that US authorities,
were not planning to discuss Ukraine’s possible accession to NATO in a written response to Russian security proposals.

In the meantime, he noted that the United States opposes reviewing the alliance’s “open door” principle.

On Tuesday, White House spokeswoman, Jennifer Basaki, said that US President Joe Biden ,
had neither the intention nor the desire to send troops to Ukraine and that decisions to deploy troops would be made jointly with NATO.