Brent oil prices hedged up during early Wednesday trading, carrying the momentum of the previous session, when the futures contract for delivery in March rose by 3%. There is growing confidence in the markets, that China’s abandonment of its zero-covid policy will lead to a sharp rebound in economic activity and therefore drive demand in the global oil markets. This scenario is supportive of oil prices; China’s expected increase in demand, at a time when Russia’s exports are coming under pressure due to Western sanctions, could generate scarcity in the markets and trigger a new escalation in oil prices.
Market operators have been taken by surprise after the BoJ surprisingly kept its ultra-low interest rate as well as its bond yield cap unchanged during its latest meeting on Wednesday. The BoJ decision caused a drop in the JPY currency amidst inflationary concerns, and boosted appetite for the equities market. This situation had an immediate impact on stocks futures almost everywhere else, and this price action has proven to be resilient since the opening bell in Europe, as benchmarks cleared their resistance levels registered earlier this week, paving the way for further market tops. Industrials and tech shares are leading the way up this morning on the old continent, while utilities and consumer non-cyclical stocks remain as the worst performers. The STOXX-50 now trades above the 4,175.0pts level with the 4,225.0pts area as the next target for equity traders. More volatility is likely to take place this morning with the new EU CPI print as well as in the afternoon with the US retail sales and PPI data. However, as long as prices hold above the recently cleared resistance levels, a bullish continuation will remain as the most likely scenario for today.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.
