Sentiment Struggles Amid Concerns of 2nd Wave of Infections
Fiona Cincotta May 12, 2020 2:38 AM
European bourses are pointing to a mixed start as investors continue to weigh up the reopening of economies against the prospect of a second wave of infections
European bourses are pointing to a mixed start as investors continue to weigh up the reopening of economies against the prospect of a second wave of infections and amid strained trade relations, but rebounding oil prices.
Whilst fears of a second wave of infections are causing some unease in the markets, oil prices are a rare source of light. Oil has jumped over 1.2% in early trade following an unexpected commitment from Saudi Arabia to cut oil production to drain some of the global oil glut. A bullish production cut of 1 million barrels per day by Saudi Arabia means that the oil producing giant has cut production by some 40% since April. The move could also go a long way to encourage other OPEC nations to comply with their cut quotas.
Whilst the cut was overshadowed in the previous session by fears of a second wave of infection, data showing that oil storage had dropped in the US’s largest oil storage at Cushing, Okla, by 2.17 million barrels offers some breathing space amid swirling storage shortage fears.
With supply now being addressed and demand slowly picking up as economies reopen, the worst appears to be behind us. API data will be in focus. Last week’s data showed a rise of 8.4 million barrels.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.