Oversupply weighs on oil, equities mixed... Iron set to cool says Citi...
Oversupply weighs on oil, equities mixed
The recent rally for oil prices is over with a further 1 per cent fall in prices overnight as oversupply concerns erase any hopes of a production cap. Goldman Sachs said Tuesday that the rally was overdone.
The bank’s assessment is that agreement between OPEC and non-OPEC members on a cap on output is not only unlikely but also won’t do much, if anything, to stabilize the volatile market.
Meanwhile, the CEO of Oil Search said that he does not see prices falling much further with the $45 to $55 a barrel range expected with rebalancing in the next 2 to 3 years.
Also remaining in focus Tuesday is the Jackson Hole speech by Fed chair Janet Yellen which is scheduled for Friday.
Asian markets closed mostly higher although thin trade was reported by many. Japan was the loser of the session as exporter stocks declined on a stronger yen.
European indexes have started Tuesday in positive mode with PMI data for the Eurozone which shows no sign of Brexit impact so far.
Wall Street and Toronto are expected to open higher.
Iron set to cool says Citi
Iron ore prices have continued to gain in 2016 even while other commodities have slumped. But analysts at Citi Group are warning that the rally for copper will not last.
The 40 per cent rise in prices have been good news for miners and investors but Citi’s report released Tuesday warns “Structurally the world remains oversupplied with relatively low-cost material.”
The recent rally for oil prices is over with a further 1 per cent fall in prices overnight as oversupply concerns erase any hopes of a production cap. Goldman Sachs said Tuesday that the rally was overdone.
The bank’s assessment is that agreement between OPEC and non-OPEC members on a cap on output is not only unlikely but also won’t do much, if anything, to stabilize the volatile market.
Meanwhile, the CEO of Oil Search said that he does not see prices falling much further with the $45 to $55 a barrel range expected with rebalancing in the next 2 to 3 years.
Also remaining in focus Tuesday is the Jackson Hole speech by Fed chair Janet Yellen which is scheduled for Friday.
Asian markets closed mostly higher although thin trade was reported by many. Japan was the loser of the session as exporter stocks declined on a stronger yen.
European indexes have started Tuesday in positive mode with PMI data for the Eurozone which shows no sign of Brexit impact so far.
Wall Street and Toronto are expected to open higher.
| Latest | 1 month ago | 1 year ago | |
| North America (previous session) |
|||
| US Dow Jones | 18,529.42 (-0.12 per cent) | -0.22 per cent | +12.57 per cent |
| TSX Composite | 14,748.19 (+0.41 per cent) | +1.01 per cent | +9.46 per cent |
| Europe (at 4.30am ET) |
|||
| UK FTSE | 6,863.39 (+0.51 per cent) | +1.97 per cent | +10.92 per cent |
| German DAX | 10,582.60 (+0.84 per cent) | +4.29 per cent | +4.52 per cent |
| Asia (at close) |
|||
| China CSI 300 | 3,341.83 (+0.15 per cent) | +3.62 per cent | -6.90 per cent |
| Japan Nikkei | 16,497.36 (-0.61 per cent) | -0.78 per cent | -15.12 per cent |
| Other Data (at 4.30am ET) |
|||
| Oil (Brent) | Oil (WTI) | Gold | Can. Dollar |
| 48.57 (-1.20 per cent) |
46.79 (-1.31 per cent) |
1344.00 (+0.04 per cent) |
U$0.7744 |
| Aus. Dollar |
|||
| U$0.7644 | |||
Iron set to cool says Citi
Iron ore prices have continued to gain in 2016 even while other commodities have slumped. But analysts at Citi Group are warning that the rally for copper will not last.
The 40 per cent rise in prices have been good news for miners and investors but Citi’s report released Tuesday warns “Structurally the world remains oversupplied with relatively low-cost material.”
