Oil up after OPEC-cut, but WTO spoils rally [Video]

Ipek Ozkardeskaya ipekScope

It has been another volatile and undecided trading session yesterday.

OPEC did cut its oil production target by 2 million barrels per day. It was the biggest cut since 2020, it was expected, it saw a morose reaction by Joe Biden - who said it was ‘shortsighted’, but a well better enthusiasm than what I expected by the oil bulls.

The barrel of US crude ended the session 1.90% higher, yet, the 50-DMA offers haven’t been cleared just yet.

The World Trade Organization gave a scary forecast for the global trade next year. The WTO raised its trade growth estimate from 3 to 3.5% for this year, but they slashed their expectation for next year to 1%, from around 3-4%. Yesterday, the investor sentiment was rather bearish. The major indices were under a decent selling pressure, following a strong two-day rally.
The data from the US was not very Fed-friendly, but it was ok. The ISM services index showed a faster than expected expansion in the US services sector, and the ADP report printed a slightly higher number than the expectations. Now all eyes are on Friday’s NFP number, and wages growth data.

In the FX, the dollar index rebounded, the EURUSD and Cable eased.

Author

Ipek Ozkardeskaya

ipekScope

Ipek Ozkardeskaya began her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked in HSBC Private Bank in Geneva in relation to high and ultra-high-net-worth clients.

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