Global equities mixed as oil plunge persists - 28.4.2020

The Dollar weakening is intact today. The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, lost 0.2% Monday as Federal Reserve expanded its $500 billion Municipal Liquidity Facility to include debt issued by smaller cities and counties and to finance them for longer than the initial program allowed. The focus is again on the central bank as it meets today after the former Minnesota Federal Reserve President Kocherlakota said over weekend the Federal Reserve should take interest rates below zero. Both EUR/USD and GBP/USD continued climbing Monday with both pairs higher currently. AUD/USD continued climbing Friday while USD/JPY continued sliding with the Australian dollar resuming declines against the dollar.

Futures on three main US stock indexes are edging higher currently after ending higher fourth session in a row Monday. 3M, Pfizer and IBM are among nearly a third of the companies in the SP 500 reporting quarterly results today. So far 122 constituents of the SP 500 have reported first-quarter numbers, with earnings down by 22.7% in aggregate. Stock indexes in US extended gains on Monday : the three main US stock indexes posted gains ranging from 1.1% to 1.5%. European stock indexes resumed advancing Monday but are down currently. Asian indexes are mixed, Hang Seng Index leading advancers with 0.9% gain.

Brent is extending losses today as worldwide oil storage is dwindling rapidly. Oil prices slumped on Monday as traders deem the drop in demand due to coronavirus shutdowns was not met by a matching cut in global crude oil output. Organization of the Petroleum Exporting Countries and other major producers agreed to commence cuts equating to 9.7 million a barrel a day, about 13% of global production, on May 1 through June. US shale oil producers have been forced to cut production too as evidenced by the Baker Hughes Friday report that the number of active US rigs drilling for oil dropped by 60 to 378 last week. The US oil benchmark West Texas Intermediate (WTI) futures plunged Monday: June WTI dropped 24.6% and is falling currently. June Brent crude closed 6.8% lower at $19.99 a barrel.