WTI climbs as OPEC+ set to meet
On Monday it was reported that OPEC and its allies, which includes Russia, are considering meeting (this week) to discuss extending production cuts, as only 30 days remain on its recent historical agreement. The report sent WTI crude to its highest level since early March, quoting a price of $35 per barrel.
In April, OPEC+ initially agreed to reduce production by an unprecedented 9.7 million barrels per day in response to the demand destruction caused by the coronavirus pandemic. The original agreement is set to conclude at the end of June, continuation will depend on Russia and Saudi Arabia being able to reach a new deal before the end of the month.
Crude now trades a few cents away from earlier highs of the day.
Stocks shake off U.S. tensions to rally on Monday
After a relatively weak end to last week’s trading, many would have believed that stocks would continue to fall this week due to protests in the U.S. over the weekend. However, the civil unrest, which saw protestors go as far as the gates of the White House, created more volatility in currency markets rather than stocks.
This along with the growing tensions with China saw the Dollar weaken, quoting near a 4-week low with cable (GBPUSD) being quoted at 1.24885. The weaker USD, encouraged investors to look at equities, leading to the S&P 500 climbing as much as 0.5%
Trump and Putin Talk G7 and more
It was reported that President Trump and Vladimir Putin spoke today on several key issues, including the possibility of holding an expanded G-7 summit in September with an invitation for Russia. An expanded group of nations could potentially also see India, South Korea and Australia invited.
The two leaders are also rumoured to have discussed the earlier mentioned OPEC+ meeting in a bid to continue boost demand for oil.
GBPUSD: Cable hit and broke its long term resistance of 1.24653 on Monday as markets reacted to the easing of the lockdown in the UK, and the civil unrest in the U.S. GBPUSD now trades at a 4-week high, with moving averages showing potential for further rallies. Could this continue, or are we looking at a false break out?
EURGBP: The gains of Sterling also stretched to its pairing with the Euro, with EURGBP selling off extensively on Pound strength. The selloff appears to have reached a floor of 0.89156.
Quote of the day:
“You have power over how you’ll respond to uncertainty.”Yvan Byeajee