Wednesday 22 November 2017

Stocks rebound as oil stabilises

Traders work at the Barclay's post on the floor of the New York Stock Exchange. Photo: Reuters
Traders work at the Barclay's post on the floor of the New York Stock Exchange. Photo: Reuters

Stock and oil prices rebounded yesterday on hopes oil producers would cut output to address the supply glut that has punished equity markets and pushed crude values to 12-year lows.

Bets that oil exporters could reduce production helped scale back some demand for low-risk yen and US and German government debt.

In Dublin the ISEQ index close up 0.79pc at 6,377.23.

Globally investors also awaited more clues to whether the Federal Reserve and other central banks will help stabilise markets that have been roiled partly due to worries about weakening economic growth in China.

"Markets have recovered with a rise in oil prices, and that indicates that the two are still strongly correlated. Today's reversal could be the first step towards a short-term improvement in equity prices," said Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets in Brussels. Brent crude futures rose $1.95, or 6.39pc, to $32.45 a barrel and US crude was last up $1.77, or 5.83pc, at $32.11 per barrel. The oil rebound rekindled some appetite for stocks.

In US afternoon trading, the Dow Jones industrial average was up 275.27 points, or 1.73pc.

Some nervousness ahead of Apple's quarterly results, which are expected to show a drop in iPhone sales, was mitigated by encouraging US housing and consumer confidence data.

The pan-European FTSEurofirst 300 index closed up 0.9pc at 1,335.90.

Still, nagging worries about falling oil prices and the global economy underpinned demand for US and German government bonds and gold prices rose for a second day.


Irish Independent

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