Spreadex Market Update
Commodity collapse intensifies as Brent Crude nears 7 year low
Brent Crude is now down 1.5% this morning, leaving it at around $39.10 per barrel and perilously close to a fresh 7 year low. This helped drag the FTSE’s commodity stocks even further into the oil-sodden muck, with Premier Oil nearing a 10% drop whilst sector big boys BP and Shell fell between 1.5% and 2.5%. Despite a 2% jump for copper the miners weren’t much better, the sector’s losses lying on a spectrum between Lonmin’s near 8% fall at one end, and Rio Tinto’s 2% decline at the other.
All of this contributed, alongside a big miss in the UK’s construction output, to a 70 point fall for the FTSE, the index now effectively 10 points away from its lowest price since the end of September. Joining the FTSE every step of the way was the Eurozone indices, the DAX dropping a whopping 200 points to hit a 7 week nadir, whilst the CAC fell by 65 to trip under 4600.
And by the looks of it things are only going to get worse, the Dow futures already posting a 140 point drop. The one saving grace could be this afternoon’s selection of US data, with retail sales and the preliminary UoM consumer sentiment figure both expected to improve. Yet at this point in time any positive trading seems like a long-shot, investors fleeing the global markets in commodity-driven fear.
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