1 Dec 2014
Oil price train wreck continues – TDS
FXStreet (Barcelona) - The TD Securities Research Team note that the oil price train wreck continues as Brent crude falls as much as US$2.20 but later recovers to $68.30.
Key Quotes
“The oil price train wreck continued with Brent crude falling as much as US$2.20 to hit the lows at US$67.82 around midday in Singapore.Since then the price has recovered somewhat to US$68.30, helping the energy sector recover some the morning's earlier losses on the ASX, but the damage was done, the sector closing down 7%.”
“The move lower in oil prices continues to add to the deflationary pulse, seeing Australian swap yields hit new lows, bond yields in Aust hitting lows not seen since 2012, the 10yrs through 3%, -3bps today (the bond curve steepened 2bps) while the AUD significantly underperformed, opening at its highs at US$0.8506 and traded down as low as US$0.8417, to be currently off 0.6% to US$0.8450.”
“In contrast it was a better day in NZ, where the currency outperformed, down only 0.25% to US$0.8720, NZGB 10yr yields fell 4bps, 1 bp more than ACGB 10yrs and NZ stocks were up on the day.”
“Elsewhere in the region, the Nikkei is up 0.5%, the Hang Seng is off 1.8%, Australia –2% while Chinese stocks continue their advance, +0.35% to fresh 3yr + highs. In commodities, gold traded lower following the Swiss vote to reject stockpiling the metal, off 1.3% to US$1551oz (did get as low as US$1142oz), iron ore futures in China are 1% weaker and copper futures are off 1.5%.”
Key Quotes
“The oil price train wreck continued with Brent crude falling as much as US$2.20 to hit the lows at US$67.82 around midday in Singapore.Since then the price has recovered somewhat to US$68.30, helping the energy sector recover some the morning's earlier losses on the ASX, but the damage was done, the sector closing down 7%.”
“The move lower in oil prices continues to add to the deflationary pulse, seeing Australian swap yields hit new lows, bond yields in Aust hitting lows not seen since 2012, the 10yrs through 3%, -3bps today (the bond curve steepened 2bps) while the AUD significantly underperformed, opening at its highs at US$0.8506 and traded down as low as US$0.8417, to be currently off 0.6% to US$0.8450.”
“In contrast it was a better day in NZ, where the currency outperformed, down only 0.25% to US$0.8720, NZGB 10yr yields fell 4bps, 1 bp more than ACGB 10yrs and NZ stocks were up on the day.”
“Elsewhere in the region, the Nikkei is up 0.5%, the Hang Seng is off 1.8%, Australia –2% while Chinese stocks continue their advance, +0.35% to fresh 3yr + highs. In commodities, gold traded lower following the Swiss vote to reject stockpiling the metal, off 1.3% to US$1551oz (did get as low as US$1142oz), iron ore futures in China are 1% weaker and copper futures are off 1.5%.”