By Andre Botha, Senior Dealer, TreasuryONE
The big story overnight was in the collapse of the May futures price for West Texas Intermediate oil. The price settled at negative $37.63 per barrel last night as dealers scrambled to sell long positions ahead of today’s futures closeout. The price has stabilised this morning and is currently quoted at positive $1.65 per barrel. The June futures price which is closer to the real Oil price is trading at $21.14 per barrel while Brent is at $25.42.
The collapse in Oil unnerved markets and pushed equity markets lower and the Dollar firmer as the risk sentiment soured. The S&P closed 1.79% down, the Nasdaq 1.03% down and the Dow 2.44% down. US futures are trading negative this morning, pointing to further declines. Asian stocks are also in the red this morning while the JSE closed 0.58% lower yesterday.
The Dollar is firmer against most currencies this morning, trading at 1.0836 against the Euro and 1.2409 against the Pound. The Rand is trading a touch weaker than last night’s close at 18.8700, still within it’s recent 18.5000/19.0000 broader range. The Rand still has the uncertainty of potential Dollar outflows from the rebalancing of the WGBI at the end of this month hanging over it.
Gold is holding at $1 691.85 this morning.
