The latest feud between Saudi Arabia and Iran stands to push prices even lower, as Riyadh responds to the imminent end of sanctions on Iranian exports by pumping yet more crude. Using oil as a weapon is an eye-for-an-eye strategy that promises pain for everyone, especially Asian oil companies like Sinopec and commodity producers like Malaysia. More worrisome is that prices are inching closer and closer to the $25 mark where even the Saudis run out of ammo. That’s when the risk of a supply shock becomes all too real.
News of a possible North Korean nuclear test and lingering concerns over China is keeping trading desks busy this Wednesday. Global equities again see red, sovereign yields continue to fall while the dollar strength holds its strong pace approaching the FOMC meeting minutes later this afternoon.
The 19-country eurozone economy is poised for a year of "robust expansion" following its best quarterly performance in 4-1/2 years, a closely watched survey indicated Wednesday.
Next Trading Day's Important Events
- 15:30 (GMT 3) ECB Monetary Policy Meeting Accounts
- USDJPY: 118.40
- EURUSD: 1.0753
- S&P 500: 2,016.71
- NASDAQ : 4891.4