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Oil Soars On Double Dose Of Good News

Published 2016-09-08, 08:43 a/m
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Speculation on whether OPEC countries may or may not speak to each other at an upcoming conference can be all well and good for trading on slow days, ‎but there's nothing like actual data to really move markets.

WTI and Brent crude have been driving higher again overnight, boosted by two positive developments. ‎A surprisingly huge 12.1 mmbbl drop in API crude oil inventories kicked things off while better than expected China exports and particularly imports kept things going and spread the cheer out to other commodities like copper. In both cases signs of improving demand and or a decline in the supply overhang has helped to boost the market.

Oil's gains have already helped CAD to bounce back from its post-Bank of Canada statement selloff which was started by signs that Canada's summer rebound may not be as strong as hoped. Energy stocks and commodities may remain active with more inventory reports due for oil, gasoline and natural gas. Traders may particularly look to the DOE oil report for confirmation of the API figure.

China trade data also helped the Hang Seng to outperform, gaining 0.75% overnight. The FTSE is up 0.5% while US index futures and the DAX are flat.

EUR has been climbing today after the ECB monetary policy decision where the central bank held interest and deposit rates steady and indicated it plans to continue asset purchases at the current level of €80B per month through March 2017 as planned and beyond if necessary. This news sent doves hoping for more stimulus scrambling to get back on side.

With the common currency trading higher, continental indices like the Dax, CAC, IBEX and FTSE MIB have been falling. ECB President Draghi's press conference at 8:30 am EDT may shed more light on the monetary policy outlook.

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