Spreadex Market Update
Santa rally continues despite oil retracing its steps
There was no good news, or indeed real bad news, for oil today; regardless, Brent Crude’s rally, or more accurately minor rebound, failed to sustain itself. Oil’s pricing is currently spending much of its time in a vacuum, contributing to the difficulties analysts are having in predicting the commodity’s bottom. Brent Crude oil is currently above $60 per barrel, but only just; another dip below this support level could easily be on the horizon, especially with another US crude oil inventory announcement on Christmas Eve.
For the moment many of the worldwide indices have chosen to side with Santa, and have continued to rally despite oil’s renewed slip, largely been due to the US markets’ recent strength. The US markets continued to follow the trends they had fallen into at the end of last week, and poor existing home sales figures had no impact on the US markets. This could change tomorrow as they face final GDP, new home sales and core durable goods orders; these will be the final major challenge for the US markets before Christmas.
After spending much of the day making gains, slumping oil led the FTSE to a marginal loss this afternoon, as the Santa rally battled with the slipping energy sector. Whilst the FTSE has spent this Monday on the whims of other markets, tomorrow morning sees two big figures for the UK in its current account and GDP final q/q data. These numbers will set the tone for how the FTSE approaches the New Year, as after Tuesday the markets only see sporadic announcements until January.
In Europe, economic news not from Russia was especially sparse, causing the DAX to follow the USA’s lead and spend the early hours of the afternoon with marginal growth. Russia, on the other hand, ignored the usual Christmas slowness to announce the 30 billion rouble bailout of Trust Bank. Trust Bank, previously of Bruce Willis-advertising fame, is the first victim of the oil-inspired Russian economy crash, and will most likely not be the last.
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