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The Oslo Stock Exchange ended 2.2 percent on Tuesday. Equinor and Aker BP experienced growth of 3.8 and 3.4 percent, respectively. Yara Internatonal was up 4.1 percent.
– I usually say that the Oslo Stock Exchange is half oil price and half international stock exchanges. The last few days we get help from both, says Eric Bruce to Dagens Næringsliv on Tuesday afternoon.
On Monday, the stock market experienced an increase of 1.8 percent.
A barrel of North Sea oil Brent, which is a reference price for oil trade worldwide, is now traded for just under 117 dollars. This means that the oil price continues to be high and rises for the third day in a row. In addition, the indices on the European stock exchanges have risen widely.
– I think there is a lot of positioning in the market now. The end of the quarter, half year and month is approaching. Then many people choose to rebalance the company and return to their preferred composition of shares and bonds, says Bruce.
The fear of interest
When the US Federal Reserve (Fed) introduced a triple raise in the key interest rate on 15 June, the market waited anxiously. Wall Street breathed a sigh of relief at the signals that there would not be many equally large interest rate hikes, and the US stock markets ended in a broad rise the next day. But the upturn has not persisted, and quickly turned to new unrest. Before that again got a recoil the last few days.
– The market became very sour. After that, the fixed income market has priced in smaller interest rate increases, which I think is the reason why that market is now more positive. In addition, there was news from China about halving the quarantine period, which is raising the stock markets there, says Bruce.
However, he warns that it may be short-lived.
– I have a hard time believing that this will continue this summer. It depends on the inflation figures coming from the US and Europe this summer. If inflation figures from the US become high, interest rate fears will spread and the market will become sour again. There is no reason to believe that it is completely over yet, says Bruce.
The US inflation figures from May were much higher than expected, as analysts anticipated that inflation would remain unchanged at 8.3 per cent. The US Bureau of Labor Statistics showed that the annual consumer price index (CPI) rose by 8.6 per cent in May, while the CPI adjusted for energy and food prices (core inflation) rose by six per cent.
For total inflation, this is the highest annual growth since 1981. Inflation figures from June will not be available until 13 July.
– Basically, share prices have fallen (globally) due to rising interest rates, but that effect has largely been taken out now. There is a lot of uncertainty, but I think we have seen the worst in the stock market, Bruce concludes.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases using a link, which leads directly to our pages. Copying or other use of all or part of the content may only take place with written permission or as permitted by law. For additional terms se her.
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