Oil rallies after OPEC move while equities go into retreat
|Equities have faltered after two days of gains, but OPEC’s move to lop off a slab of daily oil output has resulted in a rally for crude prices.
Stocks reverse course
“Equities are eating into the gains of the past two sessions, with OPEC’s decision to go for a big cut in output has not helped the buyers to keep control. The prospect of two million barrels of daily oil output being eliminated raises the spectre of inflation again, just as the market began to hope that oil prices at least had calmed down. Of course, high volatility is a given at this point and stocks are still firmly up on where they were two days ago, but this bear market bounce is looking very shaky after just 48 hours.”
Oil pushes higher after OPEC cut
“No doubt the OPEC ministers might have hoped for a bigger reaction from the oil market than the one they actually got. Expectations of a one million barrel/day cut were trounced with the much bigger move, but a 1%+ move on the day is not to be sniffed at. Much now depends on whether the data improves from here to lay some of the recession fears to rest.”
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