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Brent crude oil finishes the week with the fall to $ 45.5 per barrel. Russian stock market falls after the oil

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Brent crude oil finishes the week with the fall to $ 45.5 per barrel. Russian stock market falls after the oil

Brent crude oil finishes the week with the fall to $ 45.5 per barrel. Russian stock market falls after the oil
July 22
14:00 2016

By the end of the session the quotations of the reference mark oil showed a negative trend, ending the week” in the red” due to expectations of the delivery growth from Libya, reports MarketWatch.

Also, an overabundance of refined petroleum products on the world market makes worry that the demand for raw materials from oil refineries may fall. Since the beginning of this week, Brent crude oil has fallen in price by almost nine percent and WTI – by about 3.8%. According to Matt Smith, the Director of Commodity Research at ClipperData, the US dollar, which is firming its position, affects the oil market on Friday. The anxiety due to the fuel oversupply in the world also impacts the market. “Supplies remain slightly above the year-ago levels for the oil and gasoline and the demand is not as strong as expected”, – reported Mr. Smith.

Gasoline and oil stocks in the US have been kept at the highest level for this time of the year in the past two decades, according to the Ministry of Energy of the country. Even the record consumption of gasoline in June could not lead to the reduction of reserves, experts note. China announced an increase in gasoline export to an unprecedented 1.1 million tones last month. This is two times much than the volume in the same month of 2015. This indicates that China’s oil refining companies sell their products abroad to release excessive reserves. Gasoline production in South Korea in January-May soared by 11%, while the consumption rose only by 2.5%.

On Friday after the oil fall the indexes of the Russian stock market fall, too. The securities of energy companies grew on the background of the ruble weakening. According to the results of the trading, on Friday the MICEX index was 1926.9, the RTS index – 935.98 points. On the Moscow Stock Exchange the dynamics of the ruble prices of "blue chips" was of different polarities within the boundaries of 1.2%. The US dollar rose to 64.87 rubles.

Over the week the MICEX index fell by 0.7% and the RTS lost 2.9%. The dollar rose by 1.36 rubles. Good news for the market was the statistics of Emerging Portfolio Fund Research (EPFR) on capital inflows .The total net cash inflow into funds, which are invested in stocks of Russian Federation, for the period from 14 to 20 July, was estimated at $197 million against the inflow of $ 6.3 million last week.

On Friday the indexes in Asia dropped due to the weakening of expectations of the further stimulus from the central banks. This happened because the ECB did not adjust the monetary policy, despite the threat of a slowdown in the economic recovery in the euro zone after the British decision to leave the EU. Meanwhile, on Friday Europe demonstrates the diverse dynamics of indexes. America has grown while oil has slipped. A negative factor for Europe has become the statistics of a research firm Markit Economics. It shows that in the UK the consolidated PMI has fallen to 47.7 points this month from 52.4 points in June. Herewith, the fall of the index was the highest in the history.

Markit Economics notes that the UK economy may show a drop by 0.4% in the third quarter of this year due to the decrease in business activity because of the country’s decision to leave the European Union.

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