The New York Stock Exchange surged on the 15th (local time). Analysts say that this is thanks to the recovery of investor sentiment as international oil prices fell below the level before the Russian invasion of Ukraine, below $100 a barrel.
On the New York Mercantile Exchange (NYMEX), the West Texas Intermediate (WTI) April futures closed at $96.44 a barrel, down 6.38% from the previous day. During the day, it fell to $93.53. It is the first time since February 28 ($95.72) that the WTI price has fallen below $100 based on the closing price.
On the London ICE Futures Exchange, Brent crude for May also closed at $99.91 per barrel, up 6.54% from the previous day. It is the first time in three weeks that Brent oil has closed below $100. WTI and Brent crude prices fell by 27% from their previous highs. On the previous day, WTI and Brent fell 5.78% and 5.12%, respectively.
The fact that the international oil price, which once soared to more than $130 a barrel after Russia’s invasion of Ukraine, turned to a downward trend, is interpreted to be influenced by expectations for a calming situation following the holding of peace talks between the two countries and the possibility of a slowdown in demand from China. Ukraine and Russia agreed to continue the peace talks that began on the 14th on the 16th. “There is room for compromise between the two countries,” the office of the President of Ukraine said.
It is also analyzed that the prediction that the demand for crude oil will decrease as the Chinese government completely shut down Shenzhen City in Guangdong Province to prevent the spread of Corona 19 also fueled the drop in oil prices. China is the world’s largest oil demanding country. The Organization of the Petroleum Exporting Countries (OPEC) released a monthly report on the same day, stating that crude oil demand could decrease due to inflation caused by the Ukraine crisis.
In the meantime, the three major indices of the New York Stock Exchange, which were weighed down by the rise in international oil prices, jumped all at once. The Nasdaq Composite closed at 12,948.62, up 2.92% from the previous day. The Dow rose 1.82% to 33,544.34 and the S&P 500 rose 2.14% to close at 4262.45.
The US producer price index (PPI) rose only 0.8% in February from the previous month, falling below market estimates, also improving investor sentiment. This is because it confirmed that inflation was not as strong as the market fears. The MoM increase rate of the core PPI, calculated excluding food and energy, which has high volatility, was only 0.2%, lower than the market expectation.
Reporter Lee Go-woon ccat@hankyung.com
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