Large jump for oil…American stock exchanges are in a critical situation
Large jump for oil American stock exchanges are in a critical situation
large jump for oil: Today, many events are expected from market participants as Federal Reserve,
Jerome Powell will present a half-year report and he will be interrogated by Senate Banking Committee.
In addition, December house prices will be detected in addition to weekly oil stock numbers
from US Petroleum Institute.
Evest is following up on developments in world markets and how these events will affect today’s trading.
A sharp rise in oil prices… West Texas mediator is over $ 61
Today, oil witnessed sharp gains amid a large case of optimism in the market.
Brent crude futures for April delivery rose during transactions to $ 66.44 at an increased rate of 1.84% a barrel.
At the same time, April futures contracts for West Texas mediator rose to record $ 61.49 a barrel, adding 3.80%.
Oil prices jumped more than one dollar today driven by optimism
about the launch of vaccination campaigns against Covid-19 and reducing production,
as US supplies were slowly returned after oil production due to severe frost in Texas last week.
On another side, OPEC’s decision for oil production from April till the end of March approached.
Large reductions will be exceptionally preserved in production,
including an additional decrease in Saudi Arabia production by 1 million barrels a day,
but investors speculate about what will happen after that.
The difficult problem
OPEC + is certainly having a difficult problem as it has to balance
an attractive increase in oil production and a very large increase which can contribute to oil prices collapse.
The United States of America
However, the decision has been so facilitated due to the situation in the United States of America
as there are many indicators that competing raw materials of the United States
will not return to the world market as soon as possible because of recent stopping in production due to bad weather conditions.
Weather in Texas
Weather in Texas has affected the entire production process
and even if weather conditions in Texas do not lead to break oil production,
US rocky oil companies will not be rushing to increase production.
crude oil prices encourage increasing production
In spite of the fact that rising crude oil prices encourage increasing production,
but the very rapid pace of production growth may negatively affect crude oil prices
and lead to place companies in a difficult situation.
On another side, Goldman Sachs Commodities Research increased its expectations
of rising prices to a range of $ 10 for the second and third quarters of 2021.
The rationale behind the upward revision is lower projected in inventories,
higher margins, and increased speculation.
Wall Street Bank
Wall Street Bank expects that price will reach $ 70 a barrel in the second quarter,
up from the previous $ 60 and $ 75 during the third quarter, up from the previous 65.
Morgan Stanley expects oil prices to reach $ 70 a barrel
during the third quarter amid significant improvement in the market.
Oil has witnessed a major setback since March 9,
as Coronavirus “Covid-19” has affected prices and they sharply retreated.
Since the end of last year, two crudes are witnessing stable and consecutive gains to nearly compensate for all losses of last year.
Nasdaq and Standard and Poor’s lose… Dow Jones is flying alone in a positive area
Fearing too high valuations for high-growth technology stocks,
indicators of Nasdaq in New York have lost today.
Nasdaq 100 index declined by 2.63% to record 13223.74 points.
As soon as inflation expectations suddenly rose besides rising interest rates,
investors fled from those stocks that have been better performing after gaining profits in the technology sector.
The performance of leading Dow Jones
was significantly better as it exceeded its highest level on Friday.
At the end of Monday, it only rose by 0.09% to record 31,521.69 points.
Standard and Poor’s 500 indexes lost 0.77% to record 3876.50 points.
Technology shares were under large selling pressure because the height of bond revenues had led
to rising concerns of exaggerating the value of technology shares in particular.
Seltor has also been heard for periodically sensitive sectors such as finance
or energy as the economy is expected to be recovered.
Raytheon shares retreated by 1.7% after Boeing 777-200 of United Airlines
was hit by the engine on weekend.
All aircraft that have the same engines from Pratt & Whitney belonging to Raytheon must be checked now.
Boeing was closed at a decline of 2.1%, while airline shares have taken advantage
of the positive comments of Deutsch Bank analysts.
American Airlines profits
American Airlines profits rose by 9.4%, but South West Airlines rose by 3.7%.
Delta index also rose by 4.5%, but Alaska Airlines rose by 2.1%.
United Airlines was up by 3.5%, despite the weekend accident.
Tokyo is closed and Chinese markets are stable
Chinese stock market was settled after Monday’s setback.
CSI-300 which includes the largest 300 companies listed on exchanges of mainland China
slightly raised after it declined by more than 3%yesterday.
In China, CSI 300 index retreated by 0.1%.
In Hong Kong, Hang Seng Index rose by more than 1%.
Markets were closed in Japan, as there was no trading in Tokyo on Tuesday due to a public holiday.
In South Korea, the Kospi index fell by 0.1%, while S&P /ASX 200 index rose by 0.9%.
In Singapore, the main index rose by 0.7%.