OIL
After a positive start in the early stages of Asian trading, Brent oil prices are now retreating as European trading gets underway. The initial boost to the barrel's price was fueled by concerns surrounding the potential impact of escalating tensions in the Middle East, a pivotal oil-producing region. The fear of a heightened conflict, whether through a direct US attack on Iran or the imposition of stringent sanctions on Tehran's exports, is causing traders to factor in the risk to future oil supply, thus contributing to the upward pressure on crude prices.
Nevertheless, as Iran and the US seem reluctant to engage in direct conflict, traders maintain an eye on developments in China. Economic challenges in China are signalling a looming crisis that could result in significant reductions in oil consumption by the world's largest importer. Against this background, the price of the barrel looks set to remain supported above the $80 level, with the upside capped by China-related demand concerns.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
EUROPEAN SHARES
Equities were steady in Europe on Tuesday morning, holding gains registered during another positive session yesterday, as investors now brace for earning reports.
While this week's FOMC meeting and US job report will undoubtedly play a big part in shaping the short- to mid-term market sentiment towards a batch of assets, today's focus will be on corporate developments.
Indeed, on top of an important slew of reports from European companies, investors will focus on key results from the US tech sector, starting today with two of the biggest corporations: Alphabet and Microsoft.
Through this week's reports, investors hope to see if these companies' recent developments and social plans are paying off. If the figures were to prove this right, we could expect US tech giants to keep driving benchmarks to new highs.
The STOXX-50 still trades in the green so far, with almost all sectors rising apart from utilities and energy shares, where some profit-taking moves may happen following a strong rally during the last sessions.
The index has recently cleared its 4,637.0pts resistance, which now acts as a support for the market, and opened the way to its next target around 4,682.0pts.
Pierre Veyret – Technical analyst, ActivTrades
Source: ActivTrader
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