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Rising Indices, Falling Oil: The Current Market Dialogue

08 November 2023

Read on to get your Daily Market Overview and discover how the markets are moving in Indices, Treasury Bonds, Oil, and the global supply chain. 

S&P 500 Leads the Way as Indices Rally

After a series of hesitant moves early in the session yesterday, the S&P 500 rose for the seventh day in a row, its longest rally since November 2021.

The Nasdaq 100 surpassed 1%, with most of the big technology companies in positive territory and gains in the cloud software sector. 

NASDAQ (Tech100) monthly chart, November 8th, 2023. Source: CAPEX.com WebTrader 

 

Treasury Bonds Saw an Uptick

The upward trend in the price of treasury bonds (lower yields) continued yesterday not only in the United States, but globally. British government bonds rose after the Bank of England's Chief Economist hinted that rate cuts could be on the table in 2024.

This is fundamentally what is contributing to the change in the trend of global stock markets, after the falls that have occurred throughout the summer.

All this, despite some comments from Fed officials such as Kashkari who said yesterday that they have yet to win the fight against inflation and will consider further tightening if necessary. His Chicago counterpart, Austan Goolsbee, said they do not want to "pre-commit" on the future of interest rates and will look especially at recent changes in financial conditions with a near 50 basis point drop in 10-year yields.

How low can it go? Oil Continues Its Downslide

Another positive factor for the markets is the price of Oil, which sank below $80 a barrel, falling to a more than 2-month low after trade data disappointed from China that raised concerns in the world's largest oil importer.

Chinese exports fell more than expected in October amid worsening foreign demand, while an unexpected rise in imports saw China's trade surplus shrink to its worst level in 17-months.

This prolonged weakness in exports could hamper the country's growth in the future and therefore decrease oil demand.

The price of crude oil has plummeted over the past week after the possibility of a disruption in oil supplies due to a potential extension of the conflict in Israel was ruled out. 

Key Takeaways

  • The S&P 500 is on its longest rally since November 2021.
  • Treasury Bonds on the upward trend in both US and British markets.
  • Fed officials have yet to agree or announce if this is truly the end to rate hikes.
  • Oil continues to slip sinking below $80/ barrel and at a 2-month low.
  • Chinese trade surplus is at its worst in 17-months.

 

Related Articles:

  • How to Trade and Invest in Natural Gas
  • Commodity Trading and Investing

 

Sources: Bloomberg, Reuters 

 

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