It was a worst day for the market yesterday as unease over Credit Suisse spooked the world financial and commodity market.
Crude oil prices plunged 8.62% to their lowest in more than a year. U.S. crude West Texas Intermediate benchmark fell around 5% for a second day in row, to below $70 per barrel the first time since December 2021 and to an intraday bottom of $67.42, as the banking crisis that began with the collapse of mid-sized Californian lender Silicon Valley Bank now threatens Europe-based Credit Suisse — one of the world’s preeminent names in investment banking.
Brent crude fell 6.67%, to $72.17 a barrel by 10:53 a.m. ET (14:53 GMT). U.S. West Texas Intermediate crude (WTI) was down $7.35, at $66.11. Both benchmarks hit their lowest since December 2021 and have fallen for three straight days.
Hedge funds were liquidating due to rising interest rates and economic uncertainty, said Dennis Kissler, senior vice president of trading at BOK Financial, adding that heavy pressure on U.S. stocks this morning was adding to the fund liquidation in crude.
The U.S. dollar also strengthened against a basket of currencies, making it more expensive for holders of those currencies to purchase crude.
GOLD prices up by 1.48%, and settled at 58336, Silver prices gained slightly and settled at 67299 up 0.53%.
In Europe, money markets also changed their bets on rate hikes by the European Central Bank amid the banking turmoil.
Today Economic Data & Events
Japan Data
At 5.20am- Core Machinery Orders m/m, previous was at 1.6%, forecast is at 1.5%.
At 5.20am- Trade Balance, previous was at -1.82T, forecast is -1.46T%.
At 10.00am– Revised Industrial Production m/m, previous was at -4.6%, forecast is at -4.6%.
Above data is expected to have a mixed impact on Euro and base metals.
Eurozone
At 6.45pm, the ECB will release a monetary policy decision, Main Refinancing Rate forecast is at 3.50%, previous was at 3.00%.
At 7.15pm- ECB Press Conference
The ECB looks set to hike interest rates by another 50 basis points at its meeting on Thursday after already raising rates by 3 percentage points since July in a bid to tame inflation.
US
At 6.pm- Unemployment Claims, previous was at 211K, forecast is at 205K
At 6.PM- Philly Fed Manufacturing Index, previous was at -24.3, forecast is -14.7.
At 6pm– Building Permits, previous was at 1.34m, forecast is at 1.34M
All above the data expect to have a neutral impact on dollar.
At 8.0pm- Natural Gas Storage, forecast is at -62B, previous was at -84B.