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Investing.com – US stock markets witnessed marked divergences at the beginning of the session, today, Monday, moments after the statements of the US Federal Reserve member, James Bullard, to issue the first comment from a member after OPEC Plus announced a voluntary production cut that confused the markets.
And OPEC + unexpectedly announced massive and collective cuts in crude production by members, on Sunday, causing a new inflationary shock to the global economy and angering the White House. As the rise threatens the march of central banks in curbing inflation due to the resulting new growth in prices.
Meanwhile, the Industrial Purchasing Managers’ Index data issued by the Institute for Supply Management has just been released, contrary to market expectations, as this indicator is important in the outlook for the coming period, as it gives an overview of the economy’s performance in general and whether it is heading towards recession or not.
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The OPEC+ move “has the potential to push the market into deficit in the second quarter, against earlier expectations of a surplus,” said Vandana Hari, founder of Vanda Insights in Singapore, adding that higher prices could curb some demand, as well as exacerbate stubborn inflation, which she is trying to Central banks fight it, which increases recession risks.”
Zilla Capital expected that today’s US stock trading session would witness a rise in the shares of oil and energy companies in general.
In another way, she added, the market no longer expects a significant increase in US interest rates in the coming period.
The company ruled out that the “OPEC +” agreement to reduce production and the subsequent rise in crude prices would affect the monetary policy of the US Federal Reserve due to a severe slowdown in the labor market, which is one of the most important points that the Fed looks at when making interest decisions because it is one of the main determinants of the inflation rate.
Apple stock (NASDAQ:)
Analysts at Wedbush Financial Consulting said that Apple’s stock is likely to rise to its highest levels previously recorded, as they believe that investors’ confidence in continued demand for the iPhone and future service revenues will increase.
“Apple is benefiting from strong demand in Asia for the iPhone 14, with no significant production cuts,” the analysts wrote.
They indicated that raising the target price for the share of the “iPhone” maker to $205 from $190, and maintained its classification in the category of “outperforming the market.”
Federal Reserve statement a while ago
A member of the US Federal Reserve, James Bullard, said: “The US response to the banking crisis was quick and appropriate, and that the Fed can continue its tightening monetary policy to curb inflation.”
And when asked about the OPEC move and its impact on inflation, Pollard said that it is an open question and the OPEC move will have an impact in the long run.
Bullard stressed that the Fed needs to raise above 5% levels and that its personal expectations are higher than the average announced inflation of 5.1%.
Bullard expected inflation to be more entrenched and stubborn in the strong labor market sector, noting that the market has not yet been truly affected by the tightening policy. Adding, that the strength of the US labor market gives the Fed comfort to face high inflation.
Recently released data
(ISM) recorded 46.3 points for the month of March, while it was expected to score 47.5 points, and the previous reading was at 47.7 points.
While (ISM) scored 49.2 points in March after it was destined to score 51.2 points, after it scored 51.3 points in February.
Indicators at the time of writing
The industrial index rose 1% to 33,617.96 points.
It also rose by 0.45%, at 4,127.18 points.
While the compound fell 0.25 percent to 12,194.54 points.
Markets at the time of writing
It rose by 0.95% at $1,987 an ounce.
And US gold futures rose 1% to 2004 dollars.
While it decreased by 0.45%, to score 101.75 points.
Benchmark crude futures rose by about 6%, to reach 84.7 per barrel.
The US West Texas Intermediate crude price rose by 6.2%, at $80.5 a barrel.
