Archives of “West Texas Intermediate” tag

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Reasons for the sliding oil price pile up

  
Analysis, Crude
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  • Crude oil prices collapsed, with Brent crude closing under USD40/bbl for the first time since June
  • risk-off tone across markets 
  • stronger USD headwinds
  • tone was set earlier this week after Saudi Aramco cut its prices to Asian refiners, suggesting demand is weak
  • Bloomberg survey showed that only four out of ten Asian refiners would be subsequently trying to buy more Saudi crude
  • Abu Dhabi National Oil Co also cut its prices on Tuesday
  • US refiners are also cutting output, as the summer driving season ends and inventories remain high
  • rising COVID-19 infections across the globe doesn’t bode well for demand in the short term
  • futures markets widening in the contango for both Brent and WTI to their widest levels since May

The weekly oil inventory data is due out at the bottom of the hour

  
  Analysis
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Private data last night showed a bigger than expected drawdown of crude inventories

The Department of Energy will release their weekly inventory data.

The private API numbers from last night showed:
  • crude oil -8.587M vs -3.35M est.
  • gasoline -1.748M vs -1.3M estimate
  • distillates +3.824M vs +100K est
  • Cushing +1.63M
The price of September WTI crude oil futures are up $1.68 or 4.03% at $43.39. The price shot through the 50% retracement of the 2020 move lower at $41.71.  The contracts 200 day moving average is at $43.92. The high price today has reached $43.52

European indices end the session lower on the day

  
Analysis, Global Indices
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German DAX, -0.54%, UK’s FTSE 100 -0.96%

The major European indices are ending the day lower. The provisional closes are showing:

  • German DAX, -0.54%
  • France’s CAC, -1.28%
  • UK’s FTSE 100, -0.96%
  • Spain’s Ibex, -1.42%
  • Italy’s FTSE MIB, -0.74%
The 10 year yields showed meaningful moves to the downside. Italian yields fell the most at -5.7 basis points. German yields declined by -3.3 basis points
European yields are lowerIn other markets as London/European traders look to exit:
  • spot gold continues its move to the upside with a gain of $19.60 or 1.07% at $1861.50. Sobers doing even better with a $1.09 gain or 5.13% to $22.39.
  • WTI crude oil futures for September delivery are down $0.57 or -1.36% at $41.35. Inventory data confirmed the private data with a build of 4.892M barrels. The expectations was for a -2.2M draw.
In the US stock market the major indices are mixed:
  • S&P index is up 4.9 points or 0.15% at 3262.69
  • NASDAQ index is down -1 point or -0.1% at 10679.30
  • Dow industrial average is up 82 points or 0.31% at 26923.
In the forex market, the EUR is the strongest while the JPY is the weakest of the majors. The US dollar is down vs. all the major currencies with the exception of the JPY. It is near unchanged vs. the GBP and has recovered losses of around 90 basis points at the London morning session lows.

European shares end the session mixed

  
Analysis, Global Indices
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France and Spain indices move lower

The European shares are ending the session with mixed results. France and Spain indices are lower. Germany, UK, Italy are trading higher.

The provisional closes are showing:
  • Germany Dax, +0.44%
  • France CAC, -0.36%
  • UK FTSE 100, +0.6%
  • Spain’s Ibex, -0.34%
  • Italy’s FTSE MIB, +0.2%
For the week, the indices closed higher:
  • German DAX, +2.3%
  • France’s CAC, +1.9%
  • UK’s FTSE 100, +3.15%
  • Spain’s Ibex, +1.8%
  • Italy’s FTSE MIB, +3.1%
In the European debt market, the benchmark 10 year yields are mostly and modestly higher. The exception is the Italian 10 year which is trading down -1.5 basis points.
European debt market
In other markets as European/London traders look toward the exits for the week:
  • spot gold is trading at $13.50 or 0.75% $1810.70. The high price extended to $1811.11 the low has reached $1795.96
  • WTI crude oil futures are trading down $0.27 or -0.66% of $40.48. The high for the August contract reached $40.90 while the low extended to $40.02. The September contract is currently trading down $0.27 or 0.66% at $40.66
In  the US equity market, the major indices are trading mixed. The Dow industrial average is down on the day while the S&P and NASDAQ index are currently trading in the black
  • S&P index is up 3.25 points or 0.10% at 3218.81
  • NASDAQ index is up 11.5 points or 0.11% at 10,485.25
  • Dow industrial average is trading down 43.12 points or -0.16% at 26691.40
In the US debt market the yields are trading near unchanged across the curve:
  • 2 year 0.143, -0.2 basis points
  • 5 year 0.278%, +0.3 basis points
  • 10 year 0.618%, +0.1 basis point
  • 30 year 1.314%, +0.6 basis points
A look at the strongest and weakest currencies at the close of the London session shows the CHF is the strongest and the GBP is the weakest.  The US dollar is mostly lower.

European shares end the session with mixed results

  
Analysis, Global Indices
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Italy and Portugal indices move higher

the major European indices are ending the session with mixed results. Germany, France, UK and Spain show declines while Italy and Portugal eked out gains. The closes are showing:

  • German DAX, -0.43%
  • France’s CAC, -0.42%
  • UK’s FTSE 100, -0.62%
  • Spain’s Ibex, -0.2%
  • Italy’s FTSE MIB, +0.3%
  • Portugal’s PSI 20, +0.95%
Italy and Portugal indices move higher_
In the European debt market, benchmark 10 year yields fell across the board with UK yields down the most at -2.8 basis points.
European 10 year yieldsIn other markets as London/European traders look to exit:
  • spot gold $-4.25 or -0.23% $1806.05. The high for the day reached $1813.48. The low extended to $1802.97
  • WTI crude oil futures fell $0.19 or -0.46% to $41.01. It’s high price reached $41.18 while the low extended to $40.60. The September contract is currently down $0.21 or -0.51% of $41.19
In the forex market,
  • GBPUSD. The GBPUSD is trading at new session highs in the currently hourly bar. In the process, the price has moved back above its 200 and 100 hour moving average. That tilted the bias back to the upside in what has been an up and down market over the last 7 or so trading days. On the topside a trendline connecting highs from this we currently comes in at 1.2634. The high from yesterday reached 1.26487. The high for the week on Monday reached 1.26652.
  • EURUSD: The EURUSD moved higher in the London session after finding support buyers near the 38.2% retracement of the move up from the Friday low at 1.13759. The high price reached 1.1441. The high price from yesterday reached 1.14512. There is close support at 1.14223 area

Oil likes what it heard from OPEC, prices edge higher early

  
Analysis, Crude
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Crude starts the week higher

Crude starts the week higher
WTI crude rose as high as $39.90 shortly after the open. It’s since ticked a few cents lower to $39.83, which is up 25-cents on the day.
OPEC+ announced a one-month cut extension on the weekend but it wasn’t all good news as some Libyan production came back online.
Keep a close eye on the $40 with crude in the March gap. The bottom end of it is $41.05.

European major indices end their nightmare of a day

  
Analysis, Global Indices
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Major indices down over 7%

The European stock markets are now close for the day and the nightmare is over.  The major indices all closed over 7% lower.   For the year the declines are near the -20% level. Ouch.
The provisional closes for the major indices are showing:
  • German DAX, -7.4%
  • France’s CAC, -7.9%
  • UK’s FTSE 100, -7.3%
  • Spain’s Ibex, -8.1%
  • Italy’s FTSE MIB, -11.1%
For the trading year, the provisional changes are showing
  • German DAX, -19.8%
  • France’s CAC, -20.67%
  • UK’s FTSE 100, -20.3%
  • Spain’s Ibex, -18.9%
  • Italy’s FTSE MIB, -20.3%
In other markets as London/European traders look to exit:
  • spot gold is down $6.20 or -0.37% at $1667
  • WTI crude oil futures are down $8 or -19.43% at $33.26
In the US stock market:
  • S&P index is down -169 points or -5.7% the 2802
  • NASDAQ index is down -425 points or 4.98% at 8148
  • Dow is down -1600 points or -6.2% at 24263
In the US debt market yields remain sharply lower.
Major indices down over 7%_

European shares end the session with sharp declines

  
Analysis, Global Indices
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German DAX -1.8%

The major European shares are ending the session with sharp declines. For the year, the major European indices are also in the red.  A look at the provisional closes are showing:

  • German DAX, -1.8%
  • France’s CAC, -2.0%
  • UK’s FTSE 100, -1.9%
  • Spain’s Ibex, -2.4%
  • Italy’s FTSE MIB, -1.4%
For the year, changes are all in the red led by a 7% decline in the UK FTSE 100.
  • German DAX, -3.4%
  • France’s CAC, -5%
  • UK’s FTSE, -7%
  • Spain’s Ibex, -3.1%
  • Italy’s FTSE MIB, -1.6%
In other markets as the European/London traders look to exit are showing:
  • Gold is still negative. It is trading down $10.80 or -0.65% at $1648.10. The spot price tried rebound and move higher on the fall in stocks, but seems to have sellers above. Recall that in yesterday’s trade, there was a large seller reported in the futures market which helped push the price lower in the New York afternoon session
  • WTI crude oil futures are following the risk off sentiment with the contract trading down -$0.89 or -1.7% at $50.54. The price is not far off the low at $50.37. The high reached $52.02
In the US stock market, the NASDAQ is leading the charge to the downside. It is currently down -100 points or -1.11% and 9116.
  • Dow -308 points or -1.11% at 27653
  • S&P index -34.5 points or -1.07% at 3191
  • Nasdaq down -100 points or -1.11% at 9116

Markets wake up: Oil drops, gold jumps, yen bid

  
Analysis, Gold / Silver
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Risk aversion kicks in

Risk aversion kicks in
Gold is up $14 in the first minutes of trading while WTI crude has fallen 2.5% to $52.85. S&P 500 futures are down 1%. The US 10-year note future contract is up 11 ticks.
The yen is bid but not as much as I anticipated. NZD/JPY is down 50 pips to 71.69 and is the biggest percentage mover. USD/JPY is down 45 pips to 108.83.
Get ready for a wild week.

European shares rebound to end the week

  
Analysis, Global Indices
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German Dax up 1.3%.  France’s CAC, up 0.8%.  UK’s FTSE 100, +1.1%

The major European indices are ending the day higher.  For the week all but the German Dax fell.
A look at the provisional closes are showing:
  • German DAX, +1.3%
  • France’s CAC, +0.8%
  • UK’s FTSE 100, +1.1%
  • Spain’s Ibex, +0.4%
  • Italy’s FTSE MIB +1.0%

For the week, all but the German Dax are ending lower.  Provisional changes are showing

  • German DAX +0.32%
  • France’s CAC -1.34%
  • UK’s FTSE 100 -1.1%
  • Spain’s Ibex -1.3%
  • Italy’s FTSE MIB -0.82%
In other markets as the European/London traders look to exit:
  • Spot gold is trading up $9.80 or 0.64% at $1572.90
  • WTI crude oil futures are trading down $1.43 or -2.57% at $54.16
US stocks have tilted back to the downside as a US Sen. tells of the 3rd case of the coronavirus in the US.  Weekend fear is being elevated:
  • S&P index -15.78 points or -0.46% at 3309.78
  • NASDAQ index -24.97 points or -0.26% at 9377.62
  • Dow -87 points or -0.29% at 29073.83
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