wnol.info November 22 2017

Oil prices down sharply ahead of OPEC announcement

November 22 2017, 06:14 | Alonzo Simpson

Oil prices down sharply ahead of OPEC announcement

Federal Reserve Board Chair Janet Yellen holds a news conference after the central bank announced an increase in the benchmark interest rate following a Federal Open Market Committee meeting

The U.S. central bank released minutes from its May meeting Wednesday, which showed that Fed officials seemed to be in sync with how they hope to reduce their $4.5-trillion balance sheet.

Despite common consensus that the Federal Reserve will raise interest rates in June, the latest Federal Open Market Committee meeting minutes created a seed of doubt.

"The Fed made it pretty clear that the economic slowdown is transitory and as long as the economic data picks up, we should see a rate hike next month".

Best Buy BBY.N surged 12 percent as its comparable sales unexpectedly increased, making it the biggest boost on the S&P.

The S&P 500 climbed 5.97 points, or 0.3% to settle at 2,404.39, with real estate leading advancers.

Nvidia Corp. added 1.1% after Bloomberg reported that Japanese SoftBank Group Corp. had amassed a $4 billion stake in the chip maker.

The central bank held interest rates steady on Wednesday as expected, but noted strong spending by Canadians along with a housing boom and job growth.

USA stocks are climbing for the sixth day in a row Thursday as strong quarterly results from retailers including Best Buy, Williams-Sonoma and PVH give consumer-focused companies a lift.

The yuan had seen minor weakness in the previous session after Moody's Investors Services unexpectedly downgraded China's long-term local and foreign currency issuer ratings, citing expectations that China's financial strength would dwindle as growth slowed and borrowing increased.

Hang Seng Index was increased by 0.6%, the Shanghai Composite also increasing by 1.43 or 43.7971 points almost hitting the 3,107.873 mark, and the Shenzhen Composite also rising up by a total of 0.725% or 13.0341 points at 1,811.9033.

Fed policymakers also discussed at length the reasons for the first-quarter slowdown and why a measure of underlying price gains also fell further below their 2 percent inflation target, according to the minutes. The benchmark NY rate was down 1.3 percent at $50.72 a barrel while Brent, the global standard, fell 1.1 percent to $53.35. Australia's S&P ASX 200 rose 0.2 percent to 5,777.50.

Investors await the outcome of discussions in Vienna between OPEC and other oil-exporting countries on whether to extend output cuts.

ANALYST TAKE: "While a 9-month extension to production cuts is widely anticipated, comments from delegates are expected to move prices significantly and remain a driver throughout the day", said Henry Croft, research analyst at Accendo Markets.

"EM FX in general floated higher in reaction to a weakened dollar overnight and this should portend a heavier tone for USD-Asia intra-day", OCBC Bank currency economist Emmanuel Ng said in a note.

USD/JPY gained 0.34% to 111.88, while USD/CHF edged down 0.12% to 0.9717.

Other news