Home-grown good news helps compensate for oil’s latest nightmare

The markets received some much needed breathing room this afternoon, as Brent Crude oil still attempts to rain on any positive economic parade.

The ongoing, and seemingly never-ending, saga of oil’s decline continued today as the double-wounds of strong US crude inventory numbers yesterday, and OPEC’s announcement that 2015 would see demands for oil at their lowest for more than a decade. The commodity spent the day dancing around $64 per barrel, having brief escapes to $65 and worrying dips to $63. Oil’s support levels are under constant strain at the moment; it is in effect support without support, as the world refuses to come to the aid of oil’s oversupply issues.

Whilst oil has weighed on the global markets for much of the week, preventing the Dow from reaching its desired 18000 level in its immediate future, strong US data finally allowed the US index to shake off its oily coat and begin to recover some of its losses. With core retail sales, normal retail sales and unemployment claims all coming in at better-than-expected, the Dow Jones rallied off the back of this good news, and looks set for its first bullish close since last week.

The DAX also managed to stabilise today, despite it lacking the same positive sentiment the US gained from its latest economic figures. A Eurozone-wide rally today came from more bad news for the ECB, as its zero-cost loans to banks drew a shrug from those very institutions it was meant to attract, providing one more nail in the coffin for the Eurozone’s quantitative easing opponents. With each new signal of QE the Eurozone markets rally in these short-term, unsustainable bursts of bullish sentiment; however, until the President Draghi actually implements some kind of stimulus, the Eurozone indices will continue to see these boom-and-bust runs of volatility.

Finally, despite some renewed positivity in the rest of the world, the FTSE continued to operate at a loss today, as its pesky energy companies continue to have their battleships’ sunk by Brent Crude oil’s leaky ship. Alongside underperforming metal stocks, the UK index is struggling under the continual poor performances of its key sectors. With the only UK economic news today coming in the form of a falling house price balance, the FTSE had very few positives to cling on to as it can only dream of its recent highs.