Archives of “March 2020” month

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Top oil trader Vitol says the world might run out of available commercial storage in a couple of months

  
Analysis, Crude

The world’s largest oil trader, Vitol, shares their view on the oil market

Oil
  • Global oil demand could fall by more than 10% as lockdowns spread across Europe
  • Drop would be much higher if lockdowns start to take hold in the US
  • But that is currently not in their base case scenario
  • But if it does happen, “you can get as bearish as you like” on oil prices
  • Might run out of available commercial storage in a couple of months
  • Important now how much China buys into strategic stocks
A fair take on the current situation and on the commercial storage part, Vitol is assuming current OPEC production remains i.e. Saudi and Russia continue to do battle. Just some food for thought as we continue to look at how the virus situation develops across the world.

People with blood type A may be more vulnerable to coronavirus (China study)

  
  Analysis
  Tags

An ICYMI via the South China Morning Post

  • People with blood type A may be more vulnerable
  • those with type O seem more resistant,
Blood group patterns of more than 2,000 patients infected with the virus in Wuhan and Shenzhen
  • compared them to local healthy populations.
  • They found that blood type A patients showed a higher rate of infection and they tended to develop more severe symptoms.
  • researchers said the study was preliminary and more work was needed
  • “People of blood group A might need particularly strengthened personal protection to reduce the chance of infection”
An ICYMI via the South China Morning Post  

US stocks close higher but well off highs in volatile trading

  
Analysis, US Market
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Nasdaq was down -1.88% at the lows, and up 5.03% at the high today

The US stock indices are closing higher on the day but off the highs for the day. I guess you can say there well off the lows for the day too.  The NASDAQ index was down -1.8% at the lows, and up 5.03% the highs. It closed up 2.3%. The volatility is red hot.

The final numbers are showing:
  • The S&P index rose 11.29 points or 0.47% to 2409.39. The low price was at 2319.78, down -3.27% at the time. The high was at 2466.97, up 2.87% at the peak.
  • The Nasdaq index rose  160.73 points or 2.3% to 7150.57.
  • The Dow rose 188.27 points or 0.95% to 20087.19. The low price was at 19177.13, or down -3.63%. The high reached 20442.63, or up 2.73%.
A hugely volatile day for the US stocks.
The US stocks had a hugely volatile day

This is the biggest jobless claims report in a long time

  
  Analysis
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Initial jobless claims top the economic calendar

Initial jobless claims top the economic calendar
The weekly initial jobless claims report at the bottom of the hour is for the week ending March 14 so it’s before the real coronavirus crunch, which is a week or two away.
Last week was 211K and the ‘consensus’ this week is 220K but that’s far lower than what the market is expecting. State unemployment claims in some places are up 5x to 10x.
Last week I was warning about this and when I wrote that ‘The coming wave of unemployment claims is going to be unprecedented‘ there were comments like this:
Where are you guys coming up with this stuff… I was out last night eating and food places are full stores are full… you are acting like this is the end of the world…this is being blow up to be way way more that what it is… which is nothing more than a cold with a twist on it that has not even gone above last year flu session. This is completely stupid what the news media is doing.
Now it’s conventional wisdom.
What we haven’t figured out is if the bureaucracy can handle and process the level of claims to actually get people the money. That’s more important right now than a $1 trillion piece of legislation the White House is proposing to get people money at the end of April.

Japan visitors plunge by 58% in February, the most since the 2011 earthquake, tsunami

  
  Analysis

Total foreign visitors to Japan fell by 58.3% y/y in February

Japan
The 58% drop brings the total amount of foreign visitors to just over 1 million.

That is the biggest drop since April 2011 with visitors from China experiencing a 88% y/y plunge as the coronavirus outbreak keeps travelers at home. Meanwhile, visitors from South Korea also fell by a whopping 80% y/y.

I can only imagine the situation being worse at the present time as the virus outbreak in Japan itself has been a deterrent to global travelers – not to mention travel restrictions from all over the world over the last few weeks as well.

Dollar flexes its muscles to start the session

  
Analysis, Forex

EUR/USD falls to a session low of 1.0845

EUR/USD D1 19-03

The dollar is pushing forward with gains once again as it creeps higher against the euro and franc to begin the European morning. EUR/USD is brought down to a session low of 1.0845 after having traded around 1.0920 a few hours ago.
The greenback is also maintaining solid gains against the aussie and kiwi, while USD/JPY is looking to keep above 109.00 to start the session.
For EUR/USD, the pair looks to be making its way back to test the 1.0800 level but the key support level to watch out for will be the February low @ 1.0778.
Once that gives way, it opens up yet another slippery slope for the greenback to build further momentum to the downside.
As things stand, it looks like the dollar funding pressure is continuing to run its course.

European equities in a mixed mood to start the day

  
Analysis, Global Indices

Investors scratching their heads on what to make do of the ECB stimulus

  • Stoxx 600 -0.6%
  • Germany DAX -0.6%
  • France CAC 40 +0.4%
  • UK FTSE +0.1%
  • Italy FTSE MIB +3.0%
On the one hand, Italy seems to be responding well but that is mainly because of BTPs surging and bank stocks are heavily weighted in the FTSE MIB. But elsewhere, the mood is more mixed as we are seeing stocks fluctuate between flat levels and losses and gains.
Update: The DAX has already seen a swing from 0.7% gains at the open to 0.6% losses and is now back up by 0.5%.
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