Today marked another bizarre session in Markets, with Oil exploding to new highs without a broader risk-off move.
It seems that positioning for this weekend’s action is amassing around the Energy commodity, which is weighing on the Stock Markets, with most global Indices red on the session.
European Equities have led to the downside after a couple of weeks of them outperforming their peers, which is now leading to a slight turn in sentiment. In the US, the Dow closed at the bottom but the correction was modest (-0.56%)
For once, Oil did not selloff to President Trump’s announcement that “Good talks are being had [with Iran]”, which points to a Market that confirms its anxiety.
Yet, if things were so scary, US Treasuries would be trading higher and Equities much lower. So overall, it still provides either opportunity or further confusion.
Participants are turning to local interests to mitigate their risk as the weekend closure approaches, which could signal further volatility tomorrow.
The US Dollar is shining bright this week and could be the one asset to watch in the coming times. As asset managers turn the most bearish in 12 years on the Reserve Currency, technical developments signals upcoming FX volatility.
Get ready for some heavy action tomorrow. And keep track of any headlines regarding US-Iran discussions.
