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Market Recap - China disappoints, OPEC gives hope

Wednesday, May 15, 2019 10:34 AM GMT

Yesterday it was OPEC’s turn to publish its monthly report and provide with insights on global growth and the oil market. Global growth for 2019 continues to be projected at 3.2% with upward revisions for China (6.2% expected GDP growth in 2019 vs 6.1% expected growth at the April’s report) and the USA (2.6% vs prior 2.4%) and downward revision for Japan (0.4% vs prior 0.2%).

There was not downward revision for the demand growth for oil, which currently stands at 1.21mb/d (million barrels per day) and there has been a downward revision of the non-OPEC supply (2.14mb/d supply vs prior 2.18mb/d). The Iranian production is currently at 2,5mb/d while both the production of Saudi Arabia and the UAE has not increased, compared with their March production. The general picture is that the report potentially supports the price of USoil (WTI) and UKoil (Brent).

Yesterday equities managed to stop their downtrend. Dow Jones managed to close above the 200 Day moving average level. Nikkei225, Dax30 and FTSE100 rebounded. Nevertheless, the ZEW economic sentiment for Europe was disappointing and today’s macroeconomic releases from China (fixed asset investment, industrial production, retail sales, unemployment) were below expectations.

Today’s calendar includes the GDP reading of EU, US retail sales, US capacity utilization rate, US crude oil inventories and Canadian inflation.

 

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