June 22, 2021 - Financial Occultist

Italy’s FTSE MIB lower. Spain’s ibex unchanged

The major European indices are closing the session mixed. The Italy’s FTSE MIB is lower. Spain’s Ibex is unchanged. Germany, France, UK are higher.

The provisional closes are showing:

German DAX, +0.3%
France’s CAC, +0.3%
UK’s FTSE 100, +0.5%
Italy’s FTSE MIB, -0.2%
Spain’s Ibex, unchanged

In the European debt market, the benchmark 10 year yields are all higher with Italy’s yields up the most at 2.4 basis points.

Italy's FTSE MIB lower. Spain's ibex unchanged_

Russia is reportedly considering proposing an increase in oil production

22-Jun-21 01:16 pm

Anirudh Sethi

OPEC+

OPEC+ production to be discussed at next weeks meeting on July 01.

ICYMI- BoA looking for oil to spike to $100

22-Jun-21 11:14 am

Anirudh Sethi

Analysts at the bank looking for Brent to US$100/bbl this year, and into 2022.

Doing a bit of a catch-up on this, BoA research note from Monday Asia time.

BofA citing:

tighter oil supply
demand higher
“We believe that the robust global oil demand recovery will outpace supply growth over the next 18 months, further draining inventories and setting the stage for higher oil prices”

Forecasts (average price over the year)

Brent crude $68 per barrel this year (from $63)
In 2022 to average $75 (vs. $60 earlier)
U.S. shale will likely respond …. ramping up production and Brent $65 per barrel by 2023

Analysts at the bank looking for Brent to US$100/bbl this year, and into 2022.

Sotheby’s to auction rare diamond, payment in cryptocurrency accepted

22-Jun-21 10:33 am

Analysis

Anirudh Sethi

Sotheby’s announce that cryptocurrency will be accepted as payment for an “exceptional 101.38-carat pear-shaped D Flawless diamond”

one of just ten diamonds of more than 100 carats ever to come to auction
only two of which were pear-shaped
pre-sale estimate of $10 million – $15 million

Info via Reuters

Sotheby's announce that cryptocurrency will be accepted as payment for an "exceptional 101.38-carat pear-shaped D Flawless diamond"

China and iron ore – the latest regulator concerns

22-Jun-21 07:10 am

Analysis

Anirudh Sethi

China is continuing to investigate and tighten regulations on iron ore trading.

China’s state planner, the National Development and Reform Commission (NDRC), has taken the lead. Its jointly investigating, with the State Administration for Market Regulation, trading on the iron ore spot market, will tighten rules on what it calls hoarding and speculation.
will “strictly punish and disclose” irregularities such as hyping prices and hoarding,
will maintain good market order

Info comes via Reuters, more at that link.

Strong iron ore prices is supportive of the AUD, although its been hard to disentangle the impact amongst developments at the FOMC, especially since last week’s meeting.

UBS expect the iron ore price to fall:

Near-term risks for the commodity complex are increasing with the Fed turning more hawkish & China taking action to deflate commodities (eg by selling strategic base metal reserves)
we expect this to accelerate the unwinding of the ‘reflation trade’

That’s a quite scary survey result

22-Jun-21 06:03 am

Analysis

Anirudh Sethi

US Major indices close higher on the day and rally into the close

22-Jun-21 05:23 am

Anirudh Sethi

Dow up nearly 600 points as Fed concerns ease a bit.

All the major indices are closing higher on the day led by the Dow industrial average which rallied near 600 points. Stocks were supported by less hawkish than expected comments from Feds Bullard and Kaplan.