Thread: ForexMart's Forex News

February 16. Oil market dynamics

On Tuesday, the oil market demonstrates multidirectional dynamics: Brent quotes fluctuate in the range of $63-63.70 per barrel. The current price of the asset is $63.25.

Prices were supported by news that Texas oil companies are suspending operations due to the Arctic cold, which has led to power outages in many parts of the state. Analysts note that this factor could lead to a decrease in production by about 1 million barrels per day.

It should be noted that this almost completely neutralized the negative effect of the data on the number of drilling rigs in the United States. According to statistics from Baker Hughes, the number of active oil platforms has grown from 299 to 306, indicating a gradual recovery in the US oil sector.

Moreover, Brent is also being supported by an improvement in the epidemiological situation in the world amid the rapid spread of vaccines. This gives hope that new restrictions will be dispensed with this year.

Further dynamics of the oil market will depend on the behavior of the dollar. Now the US currency is declining across the entire spectrum of the market amid expectations of the final approval of the economic stimulus program from Joe Biden in the amount of $1.9 trillion.

February 17. Elon Musk's SpaceX raised $850 million

Last week, space company SpaceX, owned by Tesla CEO Elon Musk, raised $850 million in new funds, bringing the company to a valuation of around $74 billion. The funds were raised at $419.99 per share.

The previous round of funding was completed in August last year. Then SpaceX managed to raise about $2 billion at an estimate of $46 billion. Since then, Musk's company has grown by about 60% by its estimate.

Experts note that over the past three days, the market has seen a truly «insane demand» for the company. The reason for this unexpected influx of funds into the company is the development of two capital-intensive projects by SpaceX.

The first project – Starlink – is the creation of an interconnected Internet network using thousands of satellites. The network is designed to provide high-speed 5G internet to consumers anywhere in the world. Initially, the construction of Starlink was estimated at $10 billion, but now the company's management is confident that the network can bring in up to $30 billion a year.

The second project is the construction and launch of Starship missiles. The main purpose of such rockets is to deliver goods and people (up to 100 people) to the Moon and Mars.

February 18. The number of applications for unemployment benefits in the US rose worse than expected

According to the US Department of Labor, the number of initial claims for unemployment benefits for the week ended February 13, increased by 13 thousand compared with the revised figure of the previous week to 861 thousand applications.

At the same time, analysts were expecting a decrease in the indicator by 28 thousand – to 765 thousand. What is even worse – the indicators of the previous week were revised upward by more than 50 thousand to 848 thousand.

The number of secondary orders, which are counted one week behind the primary orders, also disappointed market participants. Secondary bids fell only slightly to 4.494 million from an upwardly revised 4.558 million. Analysts had expected 4.413 million.

February 19. Bitcoin capitalization approached $1 trillion

The bitcoin rate continues to update historical highs, and the cryptocurrency capitalization is approaching $1 trillion. According to the trading data, on Friday, the bitcoin rate rose to $53,250.

The capitalization of the digital currency since the beginning of 2021 has grown by almost $440 billion and, according to experts, is $979.9 billion.At the same time, the index of four cryptocurrencies calculated by Bloomberg (Galaxy Crypto Index), which includes bitcoin, has more than doubled this year.

Such a rapid rise in the value of cryptocurrency is caused by the high interest in it from institutional investors, as well as companies that consider cryptocurrency as a hedge against inflation risks. An additional factor in the price hike is the periodic mentions of #bitcoin by Tesla CEO Elon Musk on his Twitter account.

February 22. Poland and Ukraine call on the US to «end» the construction of the Nord Stream-2

Foreign Ministers of Poland and Ukraine Zbigniew Rau and Dmitry Kuleba called on US President Joe Biden to «put an end» to the construction of the Nord Stream 2 gas pipeline. In their note politicians advised Biden to use every means at his disposal to prevent the completion of the project.

Rau and Kuleba fear that Nord Stream-2 will further strengthen Russia's position in the situation with gas supplies to Europe. In addition, in their opinion, the project will convince Ukrainians that the West does not adhere to its own principles and does not care about the prosperity of Ukraine.

The ministers are convinced that Moscow was allowed to go too far in implementing the project, and Washington's position on this issue is very important.

The day before, Nord Stream, the operator of Nord Stream-2, asked the German regulator for «immediate execution» of permission to lay the pipeline in German waters. The fact is that in January, the environmental organization Deutschen Umwelthilfe, protested the previously issued permission to lay the pipe.

February 25. US stock exchanges decline after the release of statistics on the GDP

US stock exchanges are falling on Thursday after the release of statistics on GDP and the labor market.

In particular, the Dow Jones Industrial Average (DJIA) fell by 0.14% to 31,918.08 points, the NASDAQ high-tech index – by 0.25% to 13564.49 points, and the S&P 500 broad market index – by 0. 22%, up to 3916.6 points.

Investors drew attention to the statistics on the US economy: in the IV quarter, the country's GDP, according to the second estimate, grew by 4.1% on an annualized basis (if the GDP grew at the same pace for four quarters in a row). The indicator turned out to be higher than the first estimate of growth by 4%, but worse than the forecast of growth from analysts at 4.2% in annual terms.

At the same time, the US Department of Commerce kept the estimate of the fall in GDP in 2020 at 3.5%.

Labor market statistics turned out to be better than expected: the number of initial applications for unemployment benefits in the United States fell to a minimum since November 2020, and the rate of decline in the indicator became the fastest since August of the same year. The number of such applications decreased by 111 thousand, to 730 thousand.

February 26. Germany has announced four options for the future «Nord Stream 2»

The German authorities have proposed four options for the future of the «Nord Stream 2» project in order to come to a compromise with the United States and «end the grueling showdown» around the pipeline.

The first course of action proposed by Berlin is the US refusal from threats of sanctions if the «danger» for Ukraine is removed or at least reduced. This option provides for the possibility of stopping gas supply in the event that Russia stops transportation through the territory of Ukraine.

Another option is to suspend the construction of the pipeline for the purpose of negotiations. The FRG authorities note that the United States can create a special commission with the participation of Europeans, whose task will be to develop specific solutions.

Germany sees the third decision to provide investment assistance to Ukraine, which will soften Washington's position. And the fourth scenario is the continuation of the construction of the gas pipeline in spite of all countermeasures to the project.

Let us remind you that «Nord Stream 2» is a gas pipeline from Russia to Germany, laid along the bottom of the Baltic Sea. Now the facility is 95% ready, and the cost of its construction is estimated at $11 billion.

March 01. Cardano takes the lead in cryptocurrency rally

Cryptocurrency Cardano last week renewed all-time highs and came in third after Bitcoin and Ethereum in terms of market capitalization, which now exceeds $46.5 million.

Cardano's value has risen 2000% over the past year, gaining 300% in the last month alone. The digital currency has unexpectedly left behind major competitors, including Polkadot (DOT) and Ripple (XRP).

Experts note that the rise in price of the digital currency was facilitated by the fact that the project of its developers plans to roll out the Goguen update this week. The update will implement important changes that will help the platform enter the decentralized finance segment.

«Cardano is a rising star in the cryptocurrency sector,» said Nigel Greene, CEO of deVere Financial Advisory Group.

March 02. China's financial regulator announced a «bubble» in global stock markets

The China Banking and Insurance Supervision and Control Committee (CBIRC) said the rally in the US and other stock markets resembles a «bubble» and will eventually move to a correction. The head of the committee, Guo Shuqing, also noted that the American and European markets are moving in the opposite direction compared to the economy.

CBIRC comments did not support sentiment on the Hong Kong stock exchange, and Hong Kong's Hang Seng Index fell 1.2% on Tuesday. Moreover, experts believe that such statements may create even greater concern about the further tightening of China's monetary policy.

The regulator also announced a «bubble» in the real estate market in China itself. This is because many people buy houses for investment or speculative purposes, which is «very dangerous.»

The economic recovery, a surge in lending and fears of missing out on buying a home have boosted demand for real estate in major Chinese cities. As a result, the authorities have retaliated, including a new mortgage lending facility. Despite this, housing prices in the secondary market, which is less regulated by the state, jumped in January to a maximum in a year and a half.

March 3. Gold falls in price on lower demand for «safe-haven» assets

On Wednesday, the price of gold declines against the background of investors leaving defensive assets in the light of the prospects for an improvement in the economic situation in the world. In addition, the high yield on US government bonds and the expensive dollar continue to put pressure on gold quotes.

The current price of the April futures for precious metals on the New York Comex exchange is $1,710.40 per troy ounce.

Analysts note that investors are more inclined to acquire risky assets amid general optimism in the markets regarding the prospects for the development of the global economy. In addition, the continuation of mass vaccinations in countries around the world gives hope for a speedy recovery.

Also, traders are waiting for additional support for the economy from the US authorities. As you remember, last Saturday the House of Representatives of the US Congress approved a stimulus package in the amount of 1.9 trillion dollars. Now the relevant bill has yet to be passed by the Senate and signed by President Joe Biden.