Europe remains in the spotlight today, with the Eurogroup meeting scheduled to start around the NY open, suggesting the New York session could be a lively affair. Yesterday the periphery received a boost on the back of mooted proposals for EUR32 of debt issuance. While just a recommendation, it does lay the groundwork for a positive upside surprise from a meeting which at the start of the week offered up little more than a nothing-burger.
Gold is still trading very well today with the latest leg possibly coming on the back of potential further government spending under a common EU budget, which is driving XAUEUR back to the all-time highs around 1600. Of course, give traders a target, and they'll continue to throw darts until they hit the bullseye
While on the dollar side of the equation, dips to $ 1700 look very well supported.
The negative momentum in EURUSD continues ahead of today's EU leaders meeting and with European flash PMIs for April worse than expected.
Loadings of Urals at Baltic Sea terminals at the start of May are down 36% vs. April, suggesting proper compliance with the OPEC+ agreement from Russia. Russian Energy Minister Alexander Novak said that he expects total supply cuts by OPEC+ and others to reach 15-20mb/d. Crude inventory build of 15mb reported in DoE data was in line with expectations. On the negative side of the equation Crude storage utilization at Cushing has gone up to 76%.which is quicker than many have expected and could prove to be the ultimate rally capper
Markets are sitting tight with fingers crossed, waiting for Congress to offer up support for the energy sector that could involve a cash swap to incentivize producers to stop drilling until oil prices recover. But the market heaved a massive sigh of relief today that the extreme contango conditions earlier this week have alleviated. And prudence suggests risk management policies will take precedence over risk-taking adventures into the June expiry date, which should further reduce front-month contract settlement angst.
Oil basket ( WTI , CAD,AUD & MYR ) contuintues to resonate into the NY open.
The information is not to be construed as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product, or instrument; or to participate in any trading strategy. Readers should seek their own advice. Reproduction or redistribution of this information is not permitted.
Soaring US yields trigger the wrecking ball effect as yields become a source of volatility for risk, rather than a source of support