In the expectation of a vaccine and a rebound in demand for crude next year the oil markets began their “rally”. For the December Nymex market, the price of US light crude (WTI) jumped 4.3 percent on Tuesday to $44.91 per barrel, while the Brent contract for January delivery appreciated by 3.9 percent to $47.86. WTI is now at +25 percent since the beginning of November and Brent has recovered 27 percent since the beginning of the month, and both are at their peak since March 5.
Markets still foresee an extension past 31 December of OPEC+ production cuts. OPEC members will meet on 30 November and 1 December and may extend these cuts to help the prices for duration of 3 to 6 months.
Gold, on the other hand, continues to suffer from the return of risk appetite, with an ounce of yellow metal plunging 1.8% on Tuesday to $1,804.60 for the Comex December futures contract, after losing around 2% on Monday and falling 0.7% last week. Since the start of the year the yellow metal is still gaining about 18 percent, but some of its brilliance has been taken away by the less anxiety-provoking stock market climate.
Rates are growing in the US government bond market in expectation of an increase in growth in 2021. The 10-year T-Bond yield finished at 0.88 percent (+3 basis points). On the foreign exchange sector, for the dollar index, which tests its evolution against a basket of six currencies (euro, sterling pound, yen, Swiss franc, Canadian dollar and Swedish krona), the dollar decreased by 0.38 percent to 92.15 points. To $1.1890, the euro gained 0.43 percent.
The financial markets in U.S. get relieved on the news of political changes finally coming to be happen in the country weeks after the November 3 election to elect new U.S. president. Existing President Donald Trump on Tuesday, green signaled the transition process. Appointment of former Fed chair, Janet Yellen as Treasury Secretary by the president-elect Joe Biden was also an encouraging news for the Wall Street.