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Oil rises 1% as tight supply outweighs economic worries

“I never took a day off in my twenties. Not one.” — Bill Gates 

 

HEADLINES

 

 

  • Dollar slips as ECB rate hike hopes lift euro
  • Gold gains on dollar retreat, focus on cenbank cues
  • Oil rises 1% as tight supply outweighs economic worries
  • Stocks climb as U.S. earnings heat up, dollar eases for third session
  • Twitter-Musk trial on $44 billion deal set to begin in October after Musk loses effort to delay
  • GBPUSD Near Term: Upside favored

 

 

Dollar slips as ECB rate hike hopes lift euro

 

The dollar fell against the euro for a third straight session on Tuesday, following a Reuters story that European Central Bank policymakers are considering raising interest rates by a bigger-than-expected 50 basis points at their meeting on Thursday to tame record-high inflation.

The rebound in the euro, which sent it further away from the sub-parity levels of last week, coincided with falling expectations for an aggressive 100 basis points hike from the U.S. Federal Reserve this month, which knocked the dollar.

The euro rose to as high as $1.0269, up 1.2% on the day and its strongest since July 6 as money markets priced in a 60% chance of a 50 basis points hike on Thursday, up from 25% on Monday.

 

 

COMMODITIES

 

 

Gold gains on dollar retreat, focus on cenbank cues

 

Gold inched higher on Tuesday, helped by a pullback in the dollar, as investors braced for cues on the pace of interest rate hikes from major central banks this month.

Spot gold was up 0.14 at $1,711.42 per ounce. U.S. gold futures was up 0.12% to $1,711.02.

The dollar index was down 0.7%, making bullion cheaper for overseas buyers.

In recent weeks, gold has not been able to live up to its safe-haven status despite recession worries. Bullion has declined more than $350 from the $2,000 an ounce level it scaled in early March, due to the U.S. Federal Reserve’s aggressive rate hike plans and the dollar’s recent rally.

 

 

ENERGY

 

 

Oil rises 1% as tight supply outweighs economic worries

 

Oil prices edged up about 1% to a two-week high in volatile trade on Tuesday as the market focused more on tight supplies and a weaker dollar than fears an economic slowdown will hit oil demand.

Oil prices have whipsawed, supported by supply fearsdue to Western sanctions on Russia, but pressured by global central bank efforts to tame inflation which stoked fears that a potential recession could cut energy demand.

In a move that could pose a problem for supplies, Libya's new National Oil Corp (NOC) chief Farhat Bengdara rejected challenges to his appointment and as work resumed at some shuttered fields and ports.

 

 

STOCKS

 

 

Stocks climb as U.S. earnings heat up, dollar eases for third session

 

A global gauge of stocks headed for its biggest one-day percentage gain in nearly a month on Tuesday and the dollar fell for a third straight day as the door opened for the European Central Bank to enact a bigger rate hike than expected this week.

The dollar index fell 0.661%, with the euro up 0.85% to $1.0227.

Stocks on Wall Street advanced in a broad rally, joining their European counterparts, with each of the 11 major S&P sectors climbing as the U.S. corporate earnings season heats up.

 

 

Twitter-Musk trial on $44 billion deal set to begin in October after Musk loses effort to delay

 

Delaware Court of Chancery Chancellor Kathaleen McCormick ruled in Twitter’s favor on Tuesday for an expedited trial to force Elon Musk’s $44 billion acquisition of the company. The five-day trial will take place in October.

During the hearing, Twitter’s lawyer, Bill Savitt of Wachtell, Lipton, Rosen & Katz, argued that Twitter’s request for a September trial was well in line with the timelines for similar cases in the past. He added that a quick trial schedule is imperative to stop the ongoing harm Twitter has experienced from the uncertainty of the deal’s closure and alleged disparagement by Musk.

 

 

ANALYSIS

 

CHART

 

GBPUSD Near Term: Upside favored

Technical View: Long position above 1.195. Target 1.2055. Conversely, break below 1.195, to open 1.192.

Comments: The pair remains supported. Further advance favored.

 

 

 

 

Source: Trading Central 

 

 

CALENDAR

 

 

*Times in GMT

 

 

 

 

Source: FX Street Economic Calendar


Footnotes
https://www.cnbc.com/2022/07/19/currencies-dollar-fed-interest-rates-inflation.html
https://www.cnbc.com/2022/07/19/gold-markets-central-bank-interest-rates-dollar-inflation.html
https://www.reuters.com/business/energy/oil-prices-fall-taking-breather-massive-surge-2022-07-19/
https://www.reuters.com/markets/europe/global-markets-wrapup-1-2022-07-19/
https://www.cnbc.com/2022/07/19/twitter-wins-bid-for-expedited-trial-to-force-musk-to-close-deal.html
 

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