Brent’s Sell Off Continues

Wednesday, 24 October: Wall Street indices were protected from heavier losses last night as major equity markets rebounded somewhat, although pricing screens remained in the red as US investors closed for Tuesday. Overnight, it was a mixed tone in Asia, the Nikkei benefitting by electronic stocks on its index while Chinese stocks failed to gather ground after yesterday’s losses. European indices followed an upbeat mood; the FTSE 100 adding over 1.4% intra day before slipping back to close +0.11%. Sterling was impacted by background Brexit talks with PM May set to address her MPs at a private meeting today. The pound dropped against the dollar, falling to early September lows, while Italy’s budget proposal rejection by the European Commission weighed on the euro.  The CAC in France and DAX in Germany gave up earlier gains in the last hour of the session to close -0.29% and -0.79% respectively.

Brent oil continued extended October’s sell off as the commodity continues its fall from early month highs. There had been worries of a supply issue following the US’ sanctions on Iran, set to come in to force at the start of November. Saudi Arabia, the world’s largest exporter of oil, has promised to increase production to compensate, up to 11m barrels a day if required, the highest level on record for the region. Brent oil is down nearly 10% since the start of October at $76.80 at the time of writing.

The positive sentiment in equity markets failed to be reflected in the US with the Dow Jones and S&P 500 both trading lower at the open, continuing to do so at the time of writing. The indices are down 0.57% and 0.93% respectively.

Another of the UK’s “casual dining” restaurants has filed for a Company Voluntary Arrangement (CVA). Gourmet Burger Kitchen, owned by South Africa’s Famous Brands looks set to close 17 sites from its 80 currently trading in the UK, putting 250 jobs at risk. It joins the likes of Jamie’s Italian, Byron Burger and Gaucho who have all applied for CVA’s amid difficult trading in UK towns and cities.

Leave a Reply