Commodities Trading

Oil tumbled 2.5 percent on Friday, and below $100 a barrel for the first time since February, as an abrupt slow-down in US hiring soured economic sentiment and technical triggers intensified selling.

Last week’s quickening rout has effectively erased any “Iran premium” from the market, suggesting that concerns over a darkening economic outlook were taking precedence over worries about reduced exports from OPEC’s second-largest producer. Crude oil, which you can trade with Spreadex, posted a 6.1 percent weekly loss.

In CFD trading, oil markets have been balancing supply concerns stemming from a string of disruptions across the globe and the potential loss of Iranian crude due to Western sanctions against fuel demand, which has been hit by the struggling economy and high prices.

OPEC Secretary General Abdullah al-Badri said the producer group was worried about the impact of high prices on demand and that it was working hard to bring them down by pumping above official production targets.

US crude oil stockpiles rose for a sixth straight week last week to hit the highest level since 1990 as inventories shot up to a fresh record, according to weekly data from the US Energy Information Administration last Wednesday.

Domestic stocks of crude, excluding oil held in the Strategic Petroleum Reserve, rose 2.84 million barrels to 375.86 million barrels in the week to April 27, the highest level since September 1990, the data showed.

The increase was slightly higher than the 2.5-million- barrel build forecast in a poll of analysts.

Over the past six weeks, inventories have risen by nearly 29.6 million barrels, marking the biggest six-week increase since February 2009.

Domestic gasoline inventories tumbled 2 million barrels to 209.7 million barrels, the lowest level since November 2011. Analyst had forecast an 800,000-barrel drop.

Gasoline stockpiles are down nearly 22.5 million barrels from the 2012 peak of 232 million barrels struck in early February.

Distillate inventories, which include diesel and heating oil, fell 1.9 million barrels to 124 million barrels, extending draws for a sixth straight week to hit the lowest level since October 2008. Analysts had forecast a decline of 200,000 barrels.

The above is a review of the crude oil market for Monday 30 Apr 12 – Friday 4 May 12.

European spread trading markets respond to a largely positive overnight session from Asia this morning, with the MSCI Asia index trading up 1.4% against a better than expected trade balance report from China.

Concern that China’s economy might slow more than forecasted had the effect of subduing buyers of metals and basic material stocks in recent weeks, increasing volatility and soaking up liquidity to markets braced for significant stress should sellers’ fears be realised.

Gold remains in focus as dollar weakness seen yesterday and today fails to lift the precious metal above last week’s highs, adding a little strength to the bears’ case for selling against a potentially unwinding market.

Fixed-interest will be of particular interest today in light of investors pushing yields negative on German 6-month notes for the first time in Eurozone history yesterday, as ultra-liquid and short-term government paper illustrates the market’s desperation for a credible safe haven.

Bunds remain well bid this morning, yielding 1.85%.

Article by Spreadex.

CFDs, Forex and Financial Spread Trading carry a high level of risk to your capital and can result in losses larger than your initial stake/deposit. These forms of trading may not be suitable for everyone so please ensure you fully understand the risks involved. Where necessary, seek independent financial advice.

This BillionforGovernor.com is only intended for those persons of 18 years of age or older.

After a volatile trading day yesterday, commodities spread trading investors are left with a lot to think about. Growth forecasts for the UK have been lowered to 1%, as well as youth unemployment reaching a record high, breaking the 1 million mark.

Growth for the UK economy is a serious concern as unemployment continues to rise and Britain’s financial sector shed further jobs as revenues came in below expectations. The Bank of England suggested it might pump billions more into the economy with yet further QE as it said output was likely to stall and inflation could halve in 2012.

Yet further QE could be a futile attempt to stimulate the already flagging economy. The results of QE1 and QE2 are debatable and with Europe having no clear end in sight to their crisis, the Global economy is only going to suffer further.

Article by Spreadex.

CFDs, Forex and Financial Spread Trading carry a high level of risk to your capital and can result in losses larger than your initial stake/deposit. These forms of trading may not be suitable for everyone so please ensure you fully understand the risks involved. Where necessary, seek independent financial advice.

This BillionforGovernor.com is only intended for those persons of 18 years of age or older.