Investam-HK: Oil prices crashed adding pressure to an already down Stock Market
Oil prices slipped despite the success meeting with OPEC+, Saudi Arabia and Russia to cut production cost.
By: Investam HK Limited
Possible reason of the drop is because of the weakening demand and worries about the storage capacity since product is overly produced. Producers and distributors run out of place to store oils. The low demand on oil supply is due to the enhanced community quarantine all over the world which most people are staying at home 'cause by the coronavirus pandemic.
- West Texas Intermediate (WTI) crude collapse by -37.88% to $11.35 per barrel. Its biggest fall from its peak high last October 2018.
- Brent crude fell by -6.09% to $26.23 per barrel.
Gold rose by 0.2% to $1,686.23 per ounce and keeps on rising for investors are now eyeing it as a safe haven to secure their savings.
Most stocks in the U.S. market set the week lower which is already expected because the fear on the pandemic crisis keeps pushing the economy down.
- Dow Jones Industrial Average index fell by 400 points to -1.6%
- S&P 500 drop by -1.5%
- Nasdaq Composite is down by -1%
- MSCI Asia Pacific decreased by -0.8%
Currencies are also struggling to raise its price following the downturn of the economy. Euro price fell by 0.2% to $1.0858, while Japanese yen weakened 0.3% to 107.81 per dollar. The British Pound declined by 0.6% to $1.2428, but the US Dollar Index (DXY) increase a bit by 0.21% to 99.99 per dollar.
Yield in Bonds or Treasuries are also fluctuating. Bond yields usually fall if prices rise. The yield on the 2-year Treasuries declined by -0.01% .The yield on 10-year Treasuries dipped three basis points to 0.62%, while the yield on the 30-year Treasury bond decreased by 1.24%.
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