Account
New to ADSS? Open an
account now to get started.
Already have an account?
Add funds to your ADSS account
Account
New to ADSS? Open an
account now to get started.
Add funds to your ADSS account
What’s happening: Crude oil prices settled lower on Wednesday, as investors monitored the weekly US inventories data.
What happened: The Energy Information Administration (EIA) reported a decline in US crude stockpiles last week, providing a boost to oil prices earlier in the session.
However, crude prices declined to end the day lower after the US government made a downward revision to employment growth data, which stroked speculations of a slowdown in fuel demand.
Why it matters: The US government said the economy had added around 2.1 million jobs from April 2023 to March 2024. This represented a downward revision from the earlier reported figure of 2.9 million job adds. The downward revision fuelled concerns around a slowdown in the world’s largest economy, which could weigh on oil demand.
Crude oil prices have been retreating since August 12, when they jumped 3% to settle above the $80 per barrel mark on rising geopolitical concerns. Speculations of a slowdown in the US economy and a lower global demand outlook for oil have negatively impacted crude prices.
The EIA said on Wednesday that US commercial crude inventories fell by 4.6 million barrels in the latest week, versus expectations of a decline of 3 million barrels. Data also showed gasoline supply declining by 1.6 million barrels and distillate supplies contracted by 3.3 million barrels.
Meanwhile, US oil production increased by 100,000 barrels to 13.4 million bpd (barrels per day) in the week, the EIA said.
Weakness in the US dollar limited the overall losses for crude oil on Wednesday, as a lower greenback makes commodities cheaper for foreign currency holders. The US dollar index, which measures the greenback’s performance versus a basket of major peers, fell around 0.4% to 101.04.
WTI crude for October delivery declined $1.24, or 1.7%, to close at $71.93 per barrel on the NYMEX (New York Mercantile Exchange) on Wednesday, recording the weakest settlement since January 10. October Brent crude, the global benchmark, dipped $1.15, or 1.5%, to settle at $76.05 per barrel on ICE Futures Europe, closing at its lowest level since January 2.
In other energy trading, September gasoline declined 2.3% to $2.21 a gallon, while September heating oil shed 0.6% to reach $2.25 a gallon and natural gas for September delivery fell 1% to settle at $2.18 per million British thermal units.
What to watch: Investors await remarks from Federal Reserve Chairman Jerome Powell at the Jackson Hole symposium this week to get some insights into the upcoming monetary policy.
The EIA’s data on natural gas stockpiles will also remain in focus today. US natural gas supplies, which fell by 6 billion cubic feet during the week ended August 9, are expected to increase by 24 billion cubic feet in the latest week.
Context: Shares of Target jumped on Wednesday, after the company reported upbeat second-quarter earnings and raised its full-year profit forecast.
Details: Target saw a significant improvement in discretionary sales trends, with apparel comparable sales rising more than 3% in the second quarter.
Target’s quarterly adjusted earnings jumped 40% to $2.57 per share, beating consensus estimates of $2.20 per share. Sales gained 2.7% to $25.45 billion, also topping Wall Street expectations of $25.23 billion.
Target’s comparable sales rose 2% during the quarter, hitting the high end of its guidance. Traffic grew by 3% year-over-year, while digital comparable sales surged by 8.7%. The gross margin expanded to 28.9%, from 27.0% in the year-ago quarter.
Management guided to third-quarter adjusted earnings between $2.10 and $2.40 per share and projected a 0% to 2% gain in comparable sales. They also raised their full-year guidance for adjusted earnings to $9.00-$9.70 per share, from their earlier forecast of $8.60-$9.60 per share.
How shares responded: Target’s shares climbed 11.2% to close at $159.25 on Wednesday, following the release of quarterly results. The stock has gained around 11% year to date.
What to watch: Investors will continue monitoring consumer discretionary spending trends, which could significantly impact the company’s results ahead.
Other Markets: European indices closed higher on Wednesday, with the FTSE 100, DAX 40, CAC 40 and STOXX Europe 600 Index up by 0.12%, 0.50%, 0.52% and 0.33%, respectively.
Russia’s Deputy Finance Minister Olha Zykova said Ukraine will need between $12 billion to $15 billion of additional foreign assistance next year than was earlier projected due to the ongoing war. The news sent the safe-haven US dollar index higher in forex trading this morning.
The Bank of Korea held its base rate at 3.5% for the 13th time at the latest meeting, exerting pressure on the KRW/USD forex pair.
Japan’s au Jibun Bank manufacturing PMI rose to 49.5 in August, versus a four-month low of 49.1 in July. However, the figure coming in below market expectations of 49.8 sent the JPY/USD pair lower in forex trading this morning.
Australia’s Judo Bank manufacturing PMI rose to 48.7 in August, from 47.5 in the prior month. The region’s manufacturing activity remaining in the contraction zone exerted pressure on the AUD/USD forex pair.
Canada’s industrial producer prices came in flat in July following a 0.1% decline a month ago, which sent the CAD/USD pair slightly higher in forex trading this morning.
Saudi Arabia’s balance of trade, Turkey’s consumer confidence and gross foreign exchange reserves, France’s composite PMI, services PMI and manufacturing PMI, Germany’s composite PMI, services PMI and manufacturing PMI, Eurozone’s consumer confidence indicator, inflation expectations, composite PMI, services PMI, manufacturing PMI and European Central Bank’s monetary policy meeting accounts, UK’s composite PMI, services PMI, manufacturing PMI and CBI industrial trends orders, Mexico’s GDP growth rate, inflation rate and Bank of Mexico’s monetary policy meeting minutes, US Chicago Fed National Activity Index, initial jobless claims, continuing jobless claims, existing home sales, Kansas Fed Composite Index, Kansas City Fed’s Manufacturing Production index, composite PMI, services PMI and manufacturing PMI, India’s money supply M3, Brazil’s Federal tax revenues, as well as Argentina’s retail sales.
ADSS
8th floor, CI Tower
Corniche Road
PO Box 93894
Abu Dhabi
United Arab Emirates
Trading Services
ts@adss.com
+971 2 657 2414
Investing in CFDs involves a high degree of risk that you will lose your money due to the use of leverage, particularly in fast moving markets, where a relatively small movement in the price can lead to a proportionately larger movement in the value of your investment. This can result in loses that exceed the funds in your account. You should consider whether you understand how CFDs work and you should seek independent advice if necessary.
ADS Securities LLC (“ADSS”) is authorised and regulated by the Securities and Commodities Authority (“SCA”) in the United Arab Emirates as a trading broker for Over the Counter (“OTC”) Derivatives contracts and foreign exchange spot markets. ADSS is a limited liability company incorporated under United Arab Emirates law. The company is registered with the Department of Economic Development of Abu Dhabi (No. 1190047) and has its principal place of business at 8th Floor, CI Tower, Corniche Road, P.O. Box 93894, Abu Dhabi, United Arab Emirates.
The information presented is not directed at residents of any particular country outside the United Arab Emirates and is not intended for distribution to, or use by, any person in any country where the distribution or use is contrary to local law or regulation.
ADSS is an execution only service provider and does not provide advice. ADSS may publish general market commentary from time to time. Where it does, the material published does not constitute advice, or a solicitation, or a recommendation to a transaction in any financial instrument. ADSS accepts no responsibility for any use of the content presented and any consequences of that use. No representation or warranty is given as to the completeness of this information. Anyone acting on the information provided does so at their own risk.
