On Tuesday, crude oil prices plunged to their lowest levels since December 2021, with both major benchmarks falling nearly 4%. This sharp decline came in the wake of OPEC+ downgrading its demand forecast for 2024 and 2025, a move that overshadowed supply concerns arising from Tropical Storm Francine, as reported by Reuters.
Key market movements:
West Texas Intermediate (WTI) crude: Closed at $65.75 per barrel on the New York Mercantile Exchange, dropping $2.96 or 4.31% At one point, WTI futures fell over 5%, touching their lowest levels since May 2023
Brent crude futures: Settled at $69.19 per barrel on ICE Futures Europe, and fell $2.65 or 3.69%. Earlier in the trading session, Brent declined by more than $3 per barrel.
This significant price drop underscores the market's sensitivity to demand projections, particularly those from influential bodies like OPEC+. The revised forecast appears to have outweighed immediate supply disruption concerns, highlighting the complex interplay of factors influencing global oil prices.
Analysts will closely monitor how these price movements might impact production decisions and investment in the oil sector in the coming weeks.
Falling oil prices and China concerns add fuel to market fears of a U.S. recession
Concerns about China’s economy have dulled the outlook for energy demand...
Concerns about China’s economy have dulled the outlook for energy demand — contributing to a drop in U.S. and global oil prices to their lowest levels in over two years on Tuesday while exacerbating U.S. recession fears in some parts of the financial market.
Persistent fears of a steeper-than-expected economic slowdown suggest that there might be room for stock investors to react negatively on Wednesday — even if August’s CPI comes in as expected, with a monthly core rate of inflation at 0.2% that’s unchanged from July. This is because an as-expected reading could keep traders’ expectations in place for a 25-basis point Fed rate cut, instead of a 50-basis-point reduction, and may reinforce worries that officials are moving too little and too late to offset a U.S. recession.
U.S. stocks finished mostly higher on Tuesday afternoon,...
U.S. stocks finished mostly higher on Tuesday afternoon, with the S&P 500 and the Nasdaq Composite scoring back-to-back gains ahead of Wednesday's release of August's CPI inflation report.
The Dow Jones Industrial Average was down 92.63 points, or 0.2%, ending at 40,736.96, according to FactSet data.
The S&P 500 rose 24.47 points, or 0.5%, to end at 5,495.52.
The Nasdaq Composite advanced 141.28 points, or 0.8%, to finish at 17,025.88.
According to FactSet data, the S&P 500's energy and financials sectors were the only two sectors to end in the red on Tuesday, down nearly 2% and 1%, respectively. Shares of JPMorgan Chase & Co. finished 5.2% lower amid widespread pressure on bank stocks.
Traders also look at two key economic reports that will likely decide the size of the Federal Reserve's first interest-rate cut next week. August's consumer-price index report is due Wednesday morning at 8:30 a.m. Eastern time, followed by the producer-price index report on Thursday morning.
U.S. bankruptcy filings spiked in August after slowdown in July
U.S. bankruptcy filings spiked in August after a slowdown...
U.S. bankruptcy filings spiked in August after a slowdown in July, propelling the total for the first eight months of the year to the highest level since 2020 and second-highest since 2010, S&P Global Market Intelligence said Monday.
There were 452 filings in the year through end August, which compares with 466 in the same period in 2020, when the pandemic was still in full swing, and 604 in the same period in 2010.
Tropical Storm Francine nears hurricane strength as it approaches Gulf Coast
Tropical Storm Francine is ...
Tropical Storm Francine is nearing hurricane status as it charges toward the Gulf Coast, where some Louisiana communities have already begun to evacuate and slam closed their floodgates in anticipation of the storm’s likely landfall there on Wednesday.
Francine could become a hurricane sometime Tuesday and strengthen into a Category 2 hurricane by landfall.
More than 5 million people are under flood watches across the Gulf Coast so far. The storm is expected to bring rainfall totals of 4 to 8 inches from the coastline of northeast Mexico to southern Mississippi, and some places could see as much as 12 inches.
