Market Analysis

Crude oil heading to $20?

The price of oil is falling sharply again today after a few days of consolidation. The reason is simple: there is a massive imbalance of historic proportions. Global demand has slumped because of the covid-19-related lockdown. Supply, which was already higher than needed, is currently excessive to say the least as Saudi, Russia and the …

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Stocks likely to face stiff resistance despite stimulus measures

After a nice recovery over the last few days, investors will be wondering whether the selling is about to resume again in this bear market. With a growing number of countries in lockdown and the virus still spreading rapidly in Europe and the US, it is very difficult to be optimistic about the global economic …

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Stocks shrugs off Fed’s unlimited Treasury buying pledge

The Federal Reserve threw the kitchen sink at the problem caused by the coronavirus outbreak today and although the markets initially welcomed the news, the gains have since evaporated. The market’s reaction should not come as a surprise given that we have seen similar responses to other stimulus packages announced by central banks and governments …

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EUR/USD dumped on ECB stimulus, Coronavirus

Following ECB’s decision to announce a massive, open-ended, €750 billion asset purchase programme in an effort to mitigate the economic impact of the virus outbreak, the EUR/USD has nosedived. Already under pressure because of a rallying US dollar, this package was the final nail in the coffin for the single currency. If it stays below …

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Gold getting heavier

Some folks have attributed gold’s recent decline, in the face of collapsing equity prices and interest rates, to a stronger US dollar. This is not the case, as gold in euro terms have also fallen equally sharply. Investors are therefore abandoning the so-called safe-haven metal for other reasons, including because of concerns over physical demand …

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DAX: Selling continues

The brutal sell-off continued this morning as investors once again shrugged off the latest round of emergency central bank rate cuts. Equity investors are realising each passing day that the economic impact of the virus outbreak is going to be severe, after initially downplaying the risks. It is not just about cancellations of holidays, footballing …

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Limit Down: Markets crash as oil plunges

What a start to the week it has been in the markets, with crude oil losing a fifth of its value and US stock index futures limiting down after falling more than the allowable 5% in a single session. But with the European markets staging a bit of an oversold rebound, US stocks will likely …

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Gold extends recovery as stocks, yields and dollar drop

After last week’s big drop, gold has staged a sharp rally and looks set to break to a new high for the year. Investors are ignoring concerns over physical demand for the precious metal and instead concentrating on its appeal as a safe-haven commodity. The metal has risen to a high so far of $1666, …

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Fed surprises but is the 50 bp cut too early?

Did the Fed just cut interest rates because of the economic impact of the coronavirus or because of the recent slump in equity prices? Whatever the reason, supporters of Trump will claim that his renewed criticism of the Fed has done the trick. But make no mistake about it, the President will continue to call …

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