OPEC drives oil up

Daily Analysis - 07/03/2019

Sanctions on Venezuela and Iran gave a boost to oil

On Thursday Oil went up due to U.S. sanctions toward exporters, Iran and Venezuela but furthermore the continuing OPEC-led supply cuts. But prices were restrained from expanding further due to increasing commercial fuel inventories and record U.S. crude production. Brent crude futures went up to $66.34 per barrel while the U.S. West Texas Intermediate (WTI) crude oil futures rose to $56.44 per barrel.

Euro anticipating ECB

On Thursday the major currency pairs held to tight areas while investors concentrated on (ECB) policy report later in the day. But the Canadian and Australian dollars fell to near 60-day lows.

The Swiss franc and the popular Japanese yen both went up while investors found safety in the safe-haven assets. The reason for that was evidence of stress between the United States and North Korea and their renewed concerns regarding a potential global economic slowdown.

The ECB is thought to lower growth projections and is expected to give its strongest signal yet that stimulus is arising in the form of cheaper long-term bank loans.

Gold looks strong

On Thursday Gold steadied while a dim desire for riskier assets gave some relief to the safe-haven yellow metal. Nevertheless, the strong greenback restrained profits ahead of the ECB policy conference due later today.

Spot gold was strong at $1,286.48 per ounce while the U.S. gold futures fell about 0.1% at $1,286. The dollar index, which measures the USD versus major currencies, was holding near its more than 60 days high registered earlier in the week.

Dow gave back more than 130 points

On Wednesday, Stocks dropped including the major indexes registering their third continuous drop. The decline came while traders took a break following excellent profits this year. Wall Street also looked for evidence that a trade agreement between China and the U.S. could be achieved in the following months. The S&P 500 dropped more than 0.6% to 2,771.42, driven by declines in health care and energy sectors.

The Dow Jones Industrial Average gave back 133 points to 25,673.42 while Nasdaq Composite fell 0.9% to 7,505.90, noting its first three-day losing streak of 2019.