U.S. stock futures and Asian stocks fell on Thursday, extending the volatile trading seen this week. The decline came after two oil tankers were attacked in Iraqi waters, highlighting the threat to energy assets in the Middle East and sending oil prices higher.
Futures for the S&P 500 index dropped 0.8%, and Asian stock market indices fell as much as 1.1% in early trading. Brent crude oil prices rebounded to around $100 a barrel as Iraq suspended operations at its oil ports following an attack on oil tankers. Meanwhile, Bahrain said Iran had attacked its fuel storage tanks.
The energy market remains a focus for investors, with the volatility of oil and gas prices continuing to push up inflation expectations. Meanwhile, the increasingly tight situation in the private credit market has also weighed on market sentiment. Morgan Stanley has restricted the redemption amount of one of its private credit funds, returning less than half of the amount investors expected to redeem. This has exacerbated the redemption wave in the industry, and concerns over the quality of loans are growing.
“The turmoil in Iraq once again shows that this is not merely a supply issue, but more importantly, it’s about the security of transportation and the impact on transportation costs,” said Charu Chanana, chief investment strategist at Saxo Bank in Singapore. She added that the attacks have affected loading activities and port operations, “making the transportation of crude oil and condensate more uncertain and more costly.”
The rise in oil prices indicates that concerns over an escalation of the war in Iran outweigh the relief brought by the emergency release of crude oil reserves by wealthy countries. The United States plans to release 172 million barrels from its emergency oil reserves, as countries around the world strive to ease the pressure of soaring crude oil and fuel prices. This is part of a plan by International Energy Agency (IEA) member countries to release 400 million barrels from global oil reserves, which would be the largest release in the agency’s history.
US President Donald Trump said that the large-scale emergency release of oil reserves approved by the International Energy Agency would ease energy price pressure. Meanwhile, the US is seeking to “complete” its military operation against Iran. According to informed officials, Iran has informed regional mediators that for a ceasefire to be achieved, the US must guarantee that neither it nor Israel will launch attacks on Iran in the future.
Trump again hinted that the war was about to end, and at the same time, he was also preparing to use his power to allow the resumption of oil production off the coast of Southern California.
Traders have to admit that the global crude oil supply shock will not disappear soon but is likely to worsen. This is also a painful situation for the bond market, indicating that yields will rise further, which will in turn have a chain reaction on the stock and credit markets.
Alan Centner of Morgan Stanley Wealth Management said, “Although the possibility of releasing oil reserves is high, the persistent uncertainty means that oil prices will continue to face the risk of rising, which also implies that the Federal Reserve will remain cautious about cutting interest rates.”
Technical analysis:
The functions of WeChat are subject to occasional restrictions. If you want to try the plugin, please leave your contact information when adding a friend so that we can add you back easily!!!
Gold: The CPI data released overnight was in line with expectations, and subsequently, the US dollar continued to rise due to the geopolitical situation. The gold price fluctuated and declined, testing the level below 5150. The key support and resistance level for the day is in the 5160/80 area. Only by recovering and stabilizing above this level can the rebound continue. We suggest waiting for a confirmed breakthrough before considering a buy operation on a pullback. For detailed positions, please consult the plugin.
(Gold 15-minute chart)
The plugin is updated from 12:00 to 13:00 every trading day. If you want to experience the same plugin as shown in the chart, please contact V: Hana-fgfg and leave your contact information for us to get back to you.
Nasdaq: The price has now completed the liquidity sweep in the yellow area as we mentioned in the plugin yesterday. It is currently rebounding in a bullish engulfing pattern. As long as it can break through the 24,850 area in the short term, it can further target 24,950. For detailed positions, please consult the plugin.
(NASDAQ 15-minute chart)
The plugin is updated from 12:00 to 13:00 every trading day. If you want to experience the same plugin as shown in the chart, please contact V: Hana-fgfg and leave your contact information in the message for us to get back to you.
Crude oil: As we have clearly pointed out in the previous text, if the price recovers to 89, then we should try to catch some pullback buying signals. After gathering strength near 89 overnight, the price broke through to above 94. If the pullback to the 88-90 range is confirmed within the day, then we should participate in 1-2 long signals. For detailed positions, please consult the plugin.
(Crude Oil 15-Minute Chart)
The plugin is updated from 12:00 to 13:00 every trading day. If you want to experience the same plugin as shown in the picture, please contact V: Hana-fgfg and leave your contact information in the message for us to get back to you.
Today’s key financial data and events to focus on:
20:30 US Initial Jobless Claims for the Week Ended March 7 (in 10,000s)
