OIL
Brent oil prices are down by almost one percent as the European trading session gets underway. The price of the barrel is under pressure as the markets price-in lowered demand expectations. The impasse over the US debt ceiling negotiations weighs heavily on the sentiment of oil traders. If left unresolved, the current situation will end with the US treasury running out of money to meet its obligations, a scenario likely to trigger a crisis of unknown proportions. Despite the caution and nervousness resulting from the brinkmanship displayed by both sides, most investors continue to believe that there will be a last-minute agreement between Republicans and Democrats to raise the US debt ceiling. Until then, more volatility can be expected in the global oil markets, with further drops in price likely as the deadline of early June approaches.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
EUROPEAN SHARES
Share markets fluctuated in Europe on Monday, hovering close to major resistance levels, as investors await crucial macro developments from the US this week.
Despite a positive trading session in Asia overnight, driven by encouraging remarks from US President Biden indicating improved relations with China, this sentiment has not translated to European benchmarks. Uncertainty persists in European shares and US futures contracts this morning. as market sentiment remains locked by the US debt-ceiling issue, with no resolution in sight despite the approaching deadline. The positive monetary narrative laid out by Federal Reserve chairman, Jerome Powell, is now being offset by these discussions, which are likely to remain the biggest market driver for equity investors this week. A potential payment default from the world’s largest economy in early June could have a significant impact on many other regions.
Investors are likely to closely follow today’s meeting between President Biden and House Speaker Kevin McCarthy regarding the debt ceiling, while waiting for Eurozone Consumer Confidence data alongside speeches from several Fed officials today.
Pierre Veyret– Technical analyst, ActivTrades
Source: ActivTrader
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