LONDON MARKETS: London Markets Advance As Major Oil Companies React To Alleged Attack
June 13 2019 - 07:30AM
Dow Jones News
By Dave Morris
London markets were led by major oil companies as benchmarks
jumped on news of an incident involving two oil tankers near the
Strait of Hormuz.
How did markets perform?
The U.K.'s FTSE 100 also edged up 0.2%, following Wednesday's
0.4% decline.
The pound ticked down 0.1% to $1.2674. It traded flat
Wednesday.
Oil rallied significantly on news of an incident in the Gulf of
Oman. The West Texas intermediate (WTI) benchmark was up 2.8% to
$52.59/bbl, while the Brent contract was 3.2% higher at
$61.90/bbl.
What's moving the markets?
A Reuters poll
(https://www.reuters.com/article/us-usa-economy-poll/trade-war-risks-forcing-fed-rate-cut-this-year-say-economists-reuters-poll-idUSKCN1TE017?il=0)
of economists said the chances of an interest-rate cut by the U.S.
Federal Reserve have risen sharply, citing global trade tensions.
Analysis in the FT
(https://www.ft.com/content/0753f3f6-8ced-11e9-a1c1-51bf8f989972)
suggested traders appear to be shrugging off potential stimulus by
the European Central Bank, as neither the euro nor bond yields
reacted as expected to last week's dovish talk at the ECB meeting.
And China Daily reported
(http://www.chinadaily.com.cn/a/201906/13/WS5d018647a310176577230d74.html)that
economists expected a cut in the reserve requirement ratio (RRR),
as well as possible interest rate cuts, to counter trade war
related tension.
In the U.K., Conservative MPs begin the first round of voting to
choose a leader to replace outgoing Prime Minister Theresa May. A
key aspect of the debate among the leading candidates is whether
they would consider suspending Parliament to push through a no-deal
Brexit.
Which stocks are active?
Oil producers rallied
(https://www.reuters.com/article/us-global-oil/oil-surges-after-report-of-tanker-incident-in-gulf-of-oman-near-iran-idUSKCN1TE05D?il=0)
on news that two oil tankers were damaged near the Strait of
Hormuz, according to the U.S. Navy, by what they called a "reported
attack". The crews have been evacuated but no casualties have been
reported. Royal Dutch Shell PLC Class A (RDSA.LN) shares were up
0.5%, while BP PLC (BP.LN) , which opened in negative territory, is
flat.
The results of Germany's hotly contested 5G spectrum auction
came in higher than expected at EUR6.6 billion raised
(https://www.ft.com/content/c6a6a47c-8d44-11e9-a1c1-51bf8f989972).
One of the successful bidders, Vodafone Group PLC (VOD.LN) shares
were 1.4% higher.
(END) Dow Jones Newswires
June 13, 2019 07:15 ET (11:15 GMT)
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