Oil is retreating again… Nasdaq remains to be in green area
Oil is retreating again… Nasdaq remains to be in the green area
Oil is retreating again: Yesterday witnessed a number of important events.
The most important event was the announcement of the US Petroleum Institute about a surprising increase in US oil inventories
as well as Jerome Powell’s remarks on the Fed’s vision towards the economy.
Evest is following up with you on the daily price movement in global markets and the effects of events on trading.
Oil is retreating again
Increasing US inventories leads to a decrease in oil prices
Today, the price of the Brent oil barrels fell to record $ 64.48 after it recorded $ 66.79 yesterday, falling by 0.45%.
At the same time, a barrel of West Texas Intermediate crude oil was found at $ 61.20.
The announcement of the US Petroleum Institute of increasing commercial crude oil inventories in the United States of America
was the most important cause of the price’s decline.
This boosted fears of a decrease in demand in the US.
According to US Petroleum Institute, US commercial crude stocks increased by about 1 million barrels compared to the previous week.
This was contrary to expectations as experts expected retreating in stocks by about 5.3 million barrels.
Today, official oil inventory data will be issued by American Energy Administration.
On the other hand, Yesterday, Federal Reserve Chairman Jerome Powell, in his presentation for monetary policy report said that number of new species of Coronavirus cases in the country decreased during recent weeks and those ongoing vaccinations gave hope to return to a more natural life during this year.
According to Reuter
According to Reuter, Powell said: “economic recovery is still uneven, and it is far from completion,
pointing out that path for forwarding is somewhat uncertain and changeable according to conditions”.
On another side, the spread of vaccination studies against epidemic and developments related to a stimulus package of economic effects
of epidemic in the United States help to a certain extent in limiting low prices.
The start of this week was marked by a recovery in oil prices after correction at the end of last week.
Yesterday’s prices reached new records as Brent crude was at a rate of $ 66.79 a barrel while Western Texas Mediator was at $ 63 a barrel.
However, at the end of Tuesday’s session, prices moved towards the red zone,
especially after the US Petroleum Institute report as crude oil inventories in the United States rose during the week unexpectedly ended
on February 19 by 1.026 million barrels compared to a decline of 5.8 million barrels a week ago, while analysts expect a drop of 5.372 million barrels.
This data refers to a decrease in demand for raw materials from the oil refining industry which was significantly damaged due to unnatural cold weather in Texas.
On this background, fears rose among investors that the situation of the surplus will continue in oil markets during the coming weeks.
This will contribute to an increase in the accumulation of reserves. As a result, there will be pressure on prices.
Japanese Nikkei loses a lot because of gaining profits… Nasdaq has still retreated
On Wednesday, Tokyo Stock Exchange sharply closed in a session dominated by fears of higher inflation in the United States,
especially in fields of technology after a temporary decrease of Nasdaq on the previous day in Wall Street.
The main Japanese Nikkei index fell by 1.61% to record 29671.70 points,
while the broader Tupex reduced at a rate of 1.82% to record 1903.07 points.
New York Stock Exchange
On Tuesday, New York Stock Exchange closed in disarray because of rising in US Treasury bonds for 10 years
which raised fears of increasing borrowing costs which will be particularly harmful to technology companies in Nasdaq.
On another side, investors were later reassured on comments of Federal Reserve President Jerome Powell,
who confirmed that Federal Reserve will keep interest rates low as long as inflation is continually not more than 2% in the United States of America.
A Japanese analyst said to France Press Agency that concerns about a potential rise in interests in the United States pushed Japanese investors to gain profits.
In Hong Kong, Hang Seng Index reduced by 2.88% at the end of the session.
Composite Shanghai and Shenzhen sharply fell as CSI 300 index in Shanghai and Shenzhen closed at a rate of -2.55%.
In the United States, last night, Wall Street ended in divergence as Dow Jones managed to return to rising again,
while S&P and Dow Jones were settled in the green area.
Federal Reserve Chairman, Jerome Powell’s comments regarding the US economy affected the recovery of indicators,
as he said that economy is still very far from aims limited by Central Bank regarding employment and inflation.
This means that there is no intention to change critical policy to support recovery.
Powell confirmed that Federal Reserve Bank was committed to using all available tools to support the economy and to ensure that recovery in this hard period is as strong as possible.
In recent weeks, fears regarding inflation were spread but Powell
– during a hearing session before Senate Banking Committee for reporting monetary policy, “semi-annual report of US economy”,
confirmed that the increase in prices is still weak and it does not pose any danger or threat.
The rise in revenues of government bonds at their highest level in a year is also a matter of concern.
Powell said it reflects confidence in economic recovery.
As for 2021, Federal Reserve will change its view as GDP growth can be about 6%.
However, economic expectations of the United States are still “significantly uncertain” and will depend on the route of the Coronary virus.
In this regard, Powell said that vaccination campaigns which are still continuing at the pace made by President Joe Biden send hopes for recovery.
Dow Jones which earlier in the session fell to 3,11,58.76 points, closed rising by 15.66 points at a rate of 0.05% to record 31537.35.
Standard and Poor’s 500 which fell to 3805.59 rising by 4.86 points and a rate of 0.13% to record 3881.36.
Nasdaq Composite index after losing about 4% at the start, closed down by 67.85 points at a rate of 0.5% to record 13465.20 points.
Oil is retreating again