CommodityOil

Europe Weakens; Weighed by Losses in Oil Sector

By Administrator_India

Capital Sands

European stock markets sold off Tuesday, weighed by losses in the energy sector as investors react to the price of oil turning negative overnight.

At 4:25 AM ET (0825 GMT), the U.K.’s FTSE index traded 1.5% lower, France’s CAC 40 was down 2.1%, while the DAX fell 2.2%. The broader based Stoxx 600 Europe index dropped 1.4%.

The price of a barrel of West Texas Intermediate crude to be delivered in May closed at negative $37.63 on Monday, the penultimate day of trading for that contract, as investors and traders desperately sought to avoid delivery given a shortage of storage space for the current glut.

Although the equivalent Brent contract remained trading in the $20s per barrel, this was a graphic illustration of the imbalance in the crude market, with demand down around 30% as the global economy stalls.

The share prices of oil giants BP , Shell , ENI , Repsol and Total SA  all fell between 4% and 5%, while the Euro Stoxx oil & gas subsector fell 4.1%.

At 4:25 AM ET, U.S. crude June futures, the more active month, traded 3.4% lower at $19.73 a barrel. The international benchmark Brent contract fell 13.2% to $22.20.

Elsewhere, shares in Primark owner Associated British Foods fell 4.5% after it said it would not pay an interim dividend and could not provide a full-year earnings forecast.

On the flip side, shares in the London Stock Exchange climbed over 3% as coronavirus-related volatility in markets lifted first-quarter income.

The main economic release in Europe Tuesday will be the German ZEW sentiment survey, due at 5 AM ET.

“Being one of the first indicators to show how we have started Q2, the question is not if it is bad but rather how bad,” said analysts at Danske Bank, in a research note.

Elsewhere, gold futures rose 0.3% to $1,715.75/oz, while EUR/USD traded at 1.0833, down 0.3% on the day.

Related posts
Oil

Oil Cools After 3-Day Rally Amid Fed Uncertainty, U.S. inventory Build

[et_pb_section admin_label=”section”] [et_pb_row…
Read more
Oil

Oil Prices Creep Higher As IEA Flags Chinese Demand Recovery

Oil prices rose slightly on Monday tracking optimistic comments on a recovery in Chinese demand from…
Read more
Oil

Oil prices Tread Water As Markets Weigh China Recovery, Fed Caution

Oil prices were muted in early trade on Tuesday as optimism over better-than-expected economic data…
Read more
Newsletter
Become a Trendsetter
Sign up for Davenport’s Daily Digest and get the best of Davenport, tailored for you. [mc4wp_form id="729"]

Leave a Reply

Your email address will not be published. Required fields are marked *