Nikkei managed to break the losing streak Oil declines for the second session in a row


Nikkei managed to break the losing streak Oil declines for the second session in a row

Nikkei managed to break the losing streak Oil declines for the second session in a row: Positive morale continues to dominate global markets.

Major Asian indices are growing steadily, reflecting improvements in U.S. market dynamics,

as well as reports of U.S. and Chinese presidents preparing for online negotiations by the end of the year. 

Commodity markets only appear to be off-schedule in anticipation of a long weekend in the People’s Republic of China,

as well as the publication of data on unemployment and the number of new jobs in the United States on Friday

statistics may highlight concerns that they are shrinking again, as well as the Fed’s stimulus.

Evest follows all this in the following report:


Democratic-Republican budget agreement

Stock indices are rising on Wall Street

McConnell proposes an emergency increase in the national debt limit

Nikkei breaks a declining streak for 8 sessions to rise

Oil is under strong selling pressure




Democratic-Republican budget agreement

Democrats and Republicans in the US Senate have finally reached a compromise on the national debt.

Support was provided to global markets through the news about progress in solving the problem of raising public debt,

and approving the United States budget for the fiscal year 2022. 

Republican representatives in the Senate agreed to temporarily raise the national debt ceiling for two months,

to provide the amount needed to cover operating costs. Thus,

the administration of United States President Biden will have time to agree on core budgetary standards and avoid a technical default.

Stock indices are rising on Wall Street

In the United States, the stock indices rose by 0.3-0.5٪ at the close of trading on Wednesday.

The indices started the session in the negative zone with growing concerns of accelerated inflation in conjunction with rising oil prices,

uncertainty about the situation under the national debt limit,

as well as expectations of an imminent reduction in the asset buyback program by the Federal Reserve System (FRS).




McConnell proposes an emergency increase in the national debt limit

US President Joe Biden announced an urgent need to raise the US national debt limit during a meeting at the White House with representatives of major banks and corporations on Wednesday. 

Congress needs to approve an increase in the US government’s debt limit until October 18 – the “deadline” date in the words of US Treasury Secretary Janet Yellen. 

Yellen also reiterated, during Wednesday’s White House meeting, that after October 18, her administration will run out of money.

The US stock market was also supported on Wednesday by Senate Minority Leader Mitch McConnell’s proposal for a short-term solution to the problem. 

McConnell said Republicans will allow Democrats to implement “an emergency increase in the national debt limit by a steady amount covering government spending” through routine action before the December deadline.

Republicans refrained from approving a bill to raise the public debt ceiling earlier and insisted that Democrats planning such large expenditures should be fully responsible.

The ADP industry report also became positive for the US stock market on Wednesday,

showing a 568 thousand increase in the US private sector’s jobs in September against Wall Street expectations of 425 thousand.

Official US Labor Market data for September will be released on Friday.

Analysts predict an average increase in US jobs of 500 thousand and a decrease in unemployment to 5.1% from 5.2%.

September’s employment growth is likely to be enough for the Fed to begin phasing out the asset buyback program this year, experts say.

Nikkei breaks a declining streak for 8 sessions to rise

Stocks also rebounded on Thursday in Asia, where Japan’s Nikkei Index rose by 0.5% after declining eight consecutive sessions,

Hong Kong’s Hang Seng Index rose by 2.8%,

mainland China exchanges closed this week on the day of the formation of the People’s Republic of China),

as well as US stock futures (the future for the S&P 500 index rose by 0.6%).

Stocks in Chinese real estate developer China Estates Holdings,

one of the major shareholders in the heavily indebted China Evergrande Group,

rose by more than 30% on Thursday against the backdrop of the company receiving a sale offer from Solar Bright Ltd,

where the developer valued at 91.1 billion Chinese yuan ($245.3 million).

Oil is under strong selling pressure

In the oil market, prices remained under selling pressure on Thursday morning after declining by almost 2% the previous day amid rising US inventories,

as well as falling gas prices against Russia’s promises to increase supplies to Europe.

Brent crude futures’ cost for November was $80.75 per barrel (-0.4% and + -1.8% on Wednesday),

and West Texas Intermediate crude price for November was $76.66 per barrel (-1٪ and -1 ، 9% the previous day).

According to the United States Department of Energy,

the United States commercial oil reserve rose by 2.35 million barrels last week to 420.89 million barrels. 

Experts interviewed by Bloomberg predicted inventories to rise by million barrels, according to Standard & Poor’s Global Platts poll – by 200 thousand barrels.

Inventories at the Cushing terminal, where oil traded on the NYMEX stock exchange, rose by 1.5 million barrels last week.

Gasoline inventories in the United States rose by 3.26 million barrels last week and distillates fell by 396 thousand barrels. 

Analysts predicted gasoline inventories to increase by 400 thousand barrels and distillate inventories to fall by 750 thousand barrels.

According to Bloomberg, at least one technical index has suggested that oil prices could decline this week.

The Relative Strength Index (RSI, for 14 days) of West Texas Intermediate crude,

which measures how fast prices rise or fall, rose to 70 points on Monday, indicating that the market is at its peak sale.