Today’s Stock Exchanges, June 5th. Saudi Arabia cuts oil production, the price of the barrel rises
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The market reacts to the decision of Saudi Arabia, one of the heavyweights in the global oil arena, which has put on the table a voluntary cut of 1 million barrels in the production of black gold. The move – certainly opposed by the US and Western allies – comes after the price of crude oil plunged 11% last month on fears about the strength of the global economy and China in particular. The decision came in the context of a choice by OPEC+, the cartel of oil-producing countries also extended to Russia, to extend the cuts in oil production to 2024. Riyadh’s voluntary reduction could be extended, Prince Abdelaziz ben Salmane told the end of the OPEC+ meeting in Vienna. Speaking to the press, the Saudi energy minister called the choice a “Saudi gem”, the “icing on the cake” to “bring stability back to an extremely volatile market”. On the market we then look at American debt: on Saturday, President Biden signed the debt increase and now analysts are expecting an avalanche of government issues to allow the Treasury to replenish its liquidity buffer. According to the BofA, this will lead to a liquidity drain from banks: the equivalent of a 25 point hike in Fed rates. Among other elements of attention: slips the Turkish lira after the appointment of Erdogan’s finance minister, while for the first time since 1990 Tokyo’s Nikkei index breaks through 32,000 points. Cautious the European stock exchanges waiting for Christine Lagarde to the EU Parliament.
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Tokyo closes at a 33-year high
Slightly moved spread, the Btp Valore starts
The spread between 10-year BTPs and their equivalent German Bunds opens at 166.5 points, little moved compared to the last closing at 166 points. The 10-year yield returns above 4% to 4.037%. Today the Treasury is launching the placement of the new bond dedicated to retail: the Btp Valore.
Tokyo closes at a 33-year high
Closing up for the Tokyo stock exchange which marks new highs for 33 years now. Positive market after last week’s Wall Street hikes. The Nikkei index rose 2.20% to 32,217.43 points, while the broader Topix index gained 1.70% to 2,219.79 points.
The EU Stock Exchanges open cautious waiting for Lagarde
A cautious and random start to the week for the European stock exchanges, while investors focus on the future monetary policies of the central banks and on the numerous macro data to come. In Europe there is expectation for the final data of the PMI services and composite indices of the block and its main economies, as well as for the hearing of the president of the ECB, Christine Lagarde, in the economic and monetary affairs committee of the European Parliament. In the first trades in London the Ftse 100 index gained 0.49% to 7,644.80 points, in Frankfurt the Dax rose by 0.25% to 16,091.75 points and in Paris the Cac40 dropped by 0.08% to 7,264. 97 points. In Piazza Affari, after an upward start, the Ftse Mib index falls back and loses 0.16% to 27,024.10 points.
Little moved futures for European stock exchanges
European stock index futures mixed in morning trade. The contract on the Frankfurt Dax marks -0.04%, while the Paris Cac 40 is -0.02% and the London FTSE 100 gains 0.13%. Finally, the future on the Euro Stoxx 50 yields 0.07%.
Oil on the rise with Saudi cuts
Oil prices up in today’s trading after OPEC+’s decision to extend production cuts throughout 2024. WTI futures mark an increase of 1.38% to 72.73 dollars a barrel, while Brent gains 1.27% to 77.10. Yesterday OPEC+ set the target for crude oil production at 40.46 million barrels per day, thus officially confirming most of the additional voluntary cuts announced in April for 1.66 million barrels per day.
Falling futures for Wall Street
Futures down on US stock exchanges in today’s trading as activity resumes. The Dow Jones contract was down 0.11%, the S&P 500 was down 0.34% and the Nasdaq was down 0.24%.
Turkish lira slips: Simsek finance minister
The Turkish lira slipped nearly 1% past $21 per dollar amid initial uncertainty over the appointment of the esteemed Mehmet Simsek as finance minister. The lira reached 21.1 to the dollar during the Asian session, not far from the all-time low of 21.8 reached last week. Simsek, who won the confidence of the markets during his tenures as finance minister and deputy prime minister between 2009 and 2018, said on Sunday that the country had no choice but to return to a “rational” economy.
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