Market Insights & Analysis

Read our analysts' daily briefings, together with our Market Snapshot reports.

18 Feb 2016 08:39
Front month Brent futures rebounded yesterday, offering additional stability to global equity markets which in recent weeks have been highly correlated with crude oil futures. Chinese inflation data came in broadly in line with expectations as data for January released overnight saw consumer price growth quicken, increasing 1.8% y/y from last month’s reading of 1.6% y/y. Today’s eurozone monetary policy meeting and release of eurozone December current account data will provide some interesting insights and data points for investors.
17 Feb 2016 08:19
Three month LME nickel futures managed to hold onto previous gains yesterday as prices opened firmly around the previous session’s close and traded towards $8,350/tonne. For now though, Chinese investors seem cautiously optimistic as risk appetite fuelled by PBOC assurances and positive sentiment after the Chinese New Year conflicts with Chinese debt concerns. Spot gold prices gained some support towards $1,200/oz during overnight trading despite moves lower testing appetite for prices around $1,190/oz. Front month Brent crude futures struggled to push past the 50 day moving average yesterday as the global benchmark was subjected to a protracted sell-off throughout much of the day.
16 Feb 2016 08:28
Chinese data released yesterday and overnight signalled towards a more upbeat outlook than previously expected as Beijing’s efforts were slowly starting to leave a lasting effect. The spot offshore yuan exchange rate snapped a nine session bull run against the USD overnight as risk aversion continued to dissipate steadily, providing support for the dollar to regain some of the recent losses. Crude futures have extended gains for a third straight session with activity overnight and early this morning seeing front month Brent futures post firm gains and stabilise around $35.40/bbl early on.
12 Feb 2016 08:27
The offshore Chinese yuan exchange rate gained further ground against the dollar overnight, tracking much of the region’s equity benchmarks and currencies lower as the global sell-off showed no signs of stopping any time soon. Front month WTI futures traded at their lowest level in twelve years yesterday as the US benchmark posted losses for the sixth straight session as the rout continues. Ongoing dollar weakness bizarrely offered very little support to commodities prices this week and concerns of a market-to-real economy feedback loop could gain traction if the current dynamics persist.
11 Feb 2016 08:40
Janet Yellen gave testimony to the House Financial Services Committee yesterday and as expected, played down the likelihood of another interest rate rise in March. The weaker dollar failed to offer much support to the base metals complex with zinc and tin the only two registering gains on the day. Front month Brent futures continue to trade under pressure this week but support around the $30-$30.50/bbl level continues to hold up well.
08 Feb 2016 08:27
As expected Asian trading was subdued as the week long New Year celebrations in China kicked off, with very little of note to report overnight. Saudi Arabia’s oil minister, Ali al-Naimi announced that talks held with his Venezuelan counterpart, Eulogio Del Pino, were “successful” as OPEC members increasingly step up efforts to bolster the crude market. China’s foreign exchange reserves continue to decline as the impact of the considerable efforts the PBOC have had on the world’s largest currency reserve come to light.
03 Feb 2016 08:18
The bearish outlook continued to dominate investor sentiment as the sell-off in Asian equity markets extended overnight, prompted by crude oil futures posting fresh losses. Appetite for the USD remains firm with the dollar index trading confidently above 98.700, remaining well supported towards the 50 day MA against a basket of major currencies. Safe haven assets were buoyed by the extended sell-off in Asian equity markets as the Japanese yen strengthened for the third straight session against the dollar.
02 Feb 2016 08:35
Jittery investors saw mixed trading during the Asian trading session as continued support by the PBOC saw mainland Chinese equity benchmarks rise against a backdrop of weaker stocks across the region. In a further sign of the cautious outlook adopted by many investors spot gold prices extended gains yesterday, rallying towards $1,130/oz yesterday on a combination of investment and physical demand. Front month Brent futures snapped a four day rally yesterday after briefly trading towards a four week high as investors took an opportunity to bank profits.
27 Jan 2016 08:31
Front month crude prices managed to recover the majority of Monday’s losses during yesterday’s trading session as investors viewed the sharp sell-off at the start of the week as overdone. Gold prices managed to hold onto yesterday’s gains as global growth concerns saw investors continue to pile into the safe haven asset. Chinese imports of copper rose to their highest level since December 2011 as customs data released yesterday saw the world’s second largest economy import just over 423K tonnes of the red metal.
26 Jan 2016 08:20
The brief glimmer of optimism faded overnight as the rally in risk assets that had seen last week’s bullish activity spill over to the start of this week lost steam. Spot gold prices managed to post a close above key resistance at the 100 day MA yesterday as nervous investors saw haven demand for the precious metal improve. Following on from last week’s ECB meeting, President Mario Draghi offered markets additional insight into the central bank’s outlook for the year ahead.
25 Jan 2016 08:43
Front month crude oil futures ended the week on a high note as Brent contracts for March delivery rallied back above $30/bbl, ending the session 8.6% higher. Persistent global growth concerns have shored up investment support for gold as the previous metal rebounds back above $1,100/bbl at the start of this week. The steel market in China was offered some encouragement after Premier Li Keqiang promised additional cuts to capacity as efforts to restructure the world’s biggest steel industry continue.
22 Jan 2016 08:25
The ECB signalled toward more QE as President Mario Draghi set the stage for more stimulus, citing China’s economic slowdown and persistent market volatility throughout the second half of 2015 as factors threatening the eurozone’s recovery. Front month WTI futures ended firmly higher yesterday, posting strong gains and ending the session over 11% higher compared to Wednesday’s close. A busy day for economic activity today as investors after assessing eurozone PMI data will have UK retail sales and UK public finances data to pore through.
20 Jan 2016 08:51
The pound sterling dropped to its lowest level against the USD since 2009 yesterday as Bank of England Governor Mark Carney signalled that it was too soon to consider a rates rise, pushing back the expectation further. Crude oil came under renewed pressure yesterday as Brent front month futures attempted to recover back above $30/bbl, however, these efforts were in vain as markets slid lower giving back the majority of the day’s gains. Spot gold prices rallied strongly overnight and early this morning as the safe haven asset traded back above $1,096/oz.
18 Jan 2016 08:48
Spot iron ore prices stabilised above $40/tonne last week as the steelmaking raw material faced another week of under pressure prices. Front month Brent futures slipped to a fresh multi-year low on Friday as the bears dominated the entire session, pushing the global crude benchmark as low as $28.82/bbl. A quiet session for economic data today and with a US market holiday for Martin Luther King Jr. Day we anticipate a relatively subdued European session.
14 Jan 2016 08:59
Front month Brent futures dipped below $30/bbl for the first time since 2004 as expectations that Iranian crude could soon be hitting the market dampened investor sentiment. The dollar remains well supported above the 50 day moving average as confidence in the US economy continues to build. Today is a somewhat busier session for economic activity with the Bank of England interest rate decision expected at midday followed by a string of US economic indicators.
13 Jan 2016 08:49
Another mixed session for Asian equity markets as Chinese trade data released overnight saw a bigger than expected surplus in December and PBOC intervention saw the onshore and offshore Chinese yuan exchange rates converge. Front month WTI prices dipped below $30/bbl yesterday, and the world went crazy. It spent all of two minutes trading just below this ominous level before recovering towards $30.44/bbl at the close. Today’s data will be of particular interest, with the EIA set to release their weekly crude oil inventory statistics this afternoon.
08 Jan 2016 08:34
Chinese markets began to show some signs of stability overnight, much to the relief of anxious market participants after a bearish start to the year which saw the benchmark Shanghai Composite and CSI 300 indices lose over 12% apiece this past week. It would appear that doing less is more in this regard and while policymakers in Beijing have shown an increasing willingness to prop up financial markets this over reliance on the Beijing put may in some cases be making the situation worse. Front month Brent futures hit a fresh eleven year low yesterday towards $32,16/bbl as prices surpassed the trough seen during the global financial crisis.
24 Dec 2015 08:46
US crude oil inventories posted a surprise drop last week, bucking the seasonal trend of rising stockpiles and offering some lift to front month prices. Chinese mainland equity indices pared recent gains during the overnight session as investors took short term profits off the table. A quiet session today with initial weekly jobless claims the only major data release of note. Market participants are expecting 270K new claims during the week ending December 19th, down 1,000 from the previous week’s reading of 271K.
22 Dec 2015 08:07
Prospects of additional stimulus in China saw currencies across the region rise with off-shore yuan strengthening for the third straight day. The PBOC offered up additional support to the Chinese currency, strengthening the daily fixing for the yuan on Monday and bringing an end to the recent streak of weakness which has seen onshore renminbi lose 1.5% against the dollar over the past two and a half weeks. Front month Brent futures are holding around their eleven year lows this morning as negative investor sentiment for the year ahead saw appetite for the global benchmark drop.
21 Dec 2015 08:24
It seems the euphoria from last week’s interest rate increase in the US quickly dissipated as stocks on Wall Street faced firm selling pressure on Friday. The majority of market participants polled by Bloomberg and the FT expect the Fed to increase rates by another 25 basis points as early as March next year. The dollar index remains well supported around 98.700 early on this morning after giving back some of Thursday’s gains on Friday. Just when you think it couldn’t get any lower, front month Brent futures have hit a fresh year-to-date low this morning as the global crude benchmark trades towards $36/bbl early on this morning.
15 Dec 2015 08:18
US natural gas prices slumped to their lowest level in over a decade as warm weather conditions saw the supply glut increase. Crude oil benchmarks hit a fresh low for the year on Monday as both front month Brent and WTI contracts faced renewed selling pressure early on with intraday moves hitting $36.33/bbl and $34.53/bbl respectively before a late stage rally. Iron ore prices continue to face significant headwinds at the start of this week with very little to indicate prices may recovery any time soon.
10 Dec 2015 09:20
Front month crude prices failed to halt the bear run yesterday as both Brent and WTI prices slipped for the fourth straight session after a late stage rally failed to take root. The dollar faced further headwinds ahead of next week’s FOMC rate decision as it experienced substantial selling pressure against a basket of major currencies yesterday. UK investors will be eagerly anticipating the Bank of England interest rate decision today and while the consensus expectation is for rates to remain unchanged at 0.5%, market participants will be on the lookout for any phrasing or terminology that could offer any additional insight.
09 Dec 2015 08:48
Some slightly better data coming out of China overnight as we start to see the emerging impact of stimulus measures. The yuan failed to halt its recent bearish run against the USD as investors focused on weaker factory gate prices and continued to digest yesterday’s weaker than expected trade data. Both front month Brent and WTI futures seem to have stemmed the recent outflows as they find support around yesterday’s opening levels.
08 Dec 2015 08:20
Chinese trade data released overnight painted a bleak outlook for the world’s second largest economy, prompting another run on Asian stocks with the miners in London under renewed pressure. Mainland Chinese stocks led the charge lower overnight with both the CSI 300 and Shanghai Composite losing between 1.7%-1.9%. Front month Brent futures sank to their lowest level since the financial crisis as the price per barrel hit $40.60 on selling that dominated the entire day.
03 Dec 2015 08:48
Front month Brent futures slid close to levels last seen during the financial crisis as investors took a bearish stance ahead of tomorrow’s OPEC meeting. Expectations for a Fed interest rate rise this month increased after Janet Yellen gave her strongest hints yet. A very busy session for economic data today, with global PMI data expected throughout the session as well as eurozone retail sales and US employment data.
24 Nov 2015 08:03
Three month LME nickel prices slumped to their lowest level since 2003 as prices extended declines for a sixth straight session. With the last OPEC meeting of the year looming, due to be held on December 4th in Vienna, investors are wondering what the members will make of the year where we have seen crude prices trade around multi-year lows and what the coming year will bring for the group. The dollar index flirted with 100.00 yesterday as intraday moves briefly touched this level before paring back slightly as investors maintained their positioning ahead of an expected US rates rise next month.
20 Nov 2015 08:58
Crude oil prices remain under pressure as ongoing concerns regarding global supply glut dominate the market and weigh heavily on market sentiment. This morning, WTI futures came under renewed pressure in early trade and extended declines towards $40 per barrel while the strong USD adds additional pressure to the market. Please note that both WTI and Brent front month futures have declined over $8/barrel within 3 weeks in November.
19 Nov 2015 08:58
Following a statement after October’s Fed meeting, Fed members made it clear that an interest rate increase would be considered at their “next meeting”, which is scheduled for 15-16th December 2015. The clear message spread optimistic signs across most global markets and increased risk appetite. Most Fed members agreed that US economic conditions are improving, while others agreed that conditions had already been met, in order to trigger a rate increase.
13 Nov 2015 08:57
European equities continue to remain under pressure extending losses in early trade on Friday, following the tepid GDP data. The German economy grew by 0.3% in Q3 2015, in line with expectations, while its y/y figure was reported at 1.7%, missing estimates of 1.8%. The French economy grew by 0.3% in Q3 2015, in line with estimates. The EUR continues to remain in choppy consolidation mode after hovering around 1.0750 against the USD. Today’s release of European GDP data has failed so far to provide any direction to the currency.
12 Nov 2015 08:57
Today, the main focus will switch to the release of the weekly jobless claims as well as the monthly Fed Budget Statement, which will set the tone for the trading session. Fed Chair Janet Yellen will deliver a speech at a Fed conference at 14:30 GMT, providing an insight regarding the current US economic conditions and prospects. The USD index extended gains this morning, breaking above the 99.0 area against a basket of currencies.