Switzerland’s main stock exchange dives deep into Crypto

Switzerland’s principal stock exchange has announced that it is building a platform for the trading, settlement, and custody of digital assets. This announcement follows reports of government officials working on giving crypto businesses access to banking services.



SIX Launching Digital Exchange

SIX, the operator of Switzerland’s principal stock exchange, SIX Swiss Exchange, announced Friday that it “is building a fully integrated trading, settlement and custody infrastructure for digital assets.”

The SIX exchange is fully regulated by Swiss Authorities, the Swiss Financial Market Supervisory Authority (Finma) and the Swiss National Bank, as a Financial Market Infrastructure operator. The company plans for its new platform, called Swiss Digital Exchange (SDX), to “enjoy the same standard of oversight and regulation.”

Citing that SDX will bridge “the gap between traditional financial services and digital communities,” the company claims:

SIX Digital Exchange will be the first market infrastructure in the world to offer a fully integrated end to end trading, settlement and custody service for digital assets. The service will provide a safe environment for issuing and trading digital assets, and enable the tokenization of existing securities and non-bankable assets to make previously untradeable assets tradable.

SIX CEO Jos Dijsselhof commented, “this is the beginning of a new era for capital markets infrastructures. For us it is abundantly clear that much of what is going on in the digital space is here to stay and will define the future of our industry.”

Will the Platform Trade Bitcoin Directly?

While the official announcement by SIX does not mention whether the platform will support the direct trading of cryptocurrencies, a few publications indicated that it will trade bitcoin and other cryptocurrencies.

Business Insider wrote, “SIX’s new platform, set to launch in the first half of next year, will offer end-to-end trading, settlement, and custody service for digital assets such as bitcoin and ICO [Initial Coin Offering] tokens.” The Financial Times wrote, “The platform being built by the Six exchange is designed to be used for cryptocurrencies such as bitcoin and will be based mainly on Blockchain distributed ledger technology.”

However, SIX clarified in a tweet:

First we will enable the tokenization of bankable assets like stocks or bonds and, potentially, at a later stage non-bankable assets. Whether we will also make cryptocurrencies such as bitcoin or existing ‘ICO tokens’ available, is still open.

Meanwhile, SIX has been maintaining Crypto Market Index 10. Its objective “is to reliably measure the performance of the largest and most liquid crypto assets and tokens and provide an investable benchmark for this asset class,” its website describes. “The prices for the crypto assets and tokens are obtained from multiple exchanges.”

Switzerland Wants to Become Crypto Nation

Recently, news.Bitcoin.com reported on government officials and bankers working on giving crypto businesses access to banking services since Swiss banks have reportedly been refusing accounts to crypto firms.

The country’s economic minister, Johann Schneider-Ammann, said earlier this year that his country wants to become the “crypto nation.” So far, the canton of Zug, promoting itself as the heart of “crypto valley”, has been attracting crypto start-up’s with favourable tax and regulatory environment.

In February, Finma published guidelines for ICOs after seeing a sharp increase in the number tokens planned or executed in the country and a corresponding increase in the number of inquiries about the applicability of regulation.


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Bitcoin, Ethereum, Bitcoin Cash, Ripple: Weekly Price Analysis And Prediction, May 14

From last week’s price analysis, cryptocurrencies were trading at a high price level as compared to the current cryptocurrency levels.

From the current news, Facebook has been involved in seeking the various benefits they would get from having their own cryptocurrency. Additionally, the Zimbabwe central bank was involved in the ban of the crypto dealings. In other news, the Supreme Court supported the RBI decision to ensure that the Indian crypto services are banned.

Therefore, let’s find out the current prices from the price analysis.

Bitcoin BTC

According to last week’s statistics, Bitcoin was involved in a downtrend most of the time.

During the start of the week, bitcoin was trading above the $9,500 price level. From that time, it went below various support levels which are $9,200, $9,000 and the $8,500 price level before initiating an upside on 13th may. According to the current state of Bitcoin, it has rallied to the $8,700 price levels from below the $8,400 price level.

Since the upside trend has initiated, we expect the cryptocurrency to rally to the $9,000 price levels and also the $9,200 price levels this week. On the other hand, a downside might subject the cryptocurrency to the $8,300 price levels which might attract losses.

Support level: $8,300

Resistance level: $9,000

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Ethereum ETH

Last week, Ethereum was faced with upsides and downsides in the entire week. Through the week, the cryptocurrency broke various support levels which are $740 and the $720 support levels. Ethereum further dropped below the $700 and further below the $650 price level. However, from May 12, Ethereum started an upside which has seen the cryptocurrency rise from the $644 price level to the $738 price level.

Ethereum has already adopted the bullish trend in the last two days. Therefore, we should expect the cryptocurrency to rally to the $750 and the $770 price levels soon. On the downside, in case Ethereum drops below the $700 price level, this might lead to further losses to the $670 price level.

Support level: $700

Resistance level: $750

Bitcoin cash BCH

Just like the other cryptocurrencies, bitcoin cash has been involved in a downside. This has seen the cryptocurrency drop below various support levels which are $1,500 and the $1,300 levels. On May 12, an upside initiated which saw bitcoin cash improve significantly above the $1,400 price level. Therefore, the cryptocurrency has been trading at this level for some time now. Currently, it is very close to the $1,500 price level.

Once this upside trend picks up and investors make more purchases, bitcoin cash might rally significantly to the $1,550 and the $1,650 price level this week. On the downside, a drop below the $1,400 price level might attract more losses.

Support level: $1,400

Resistance level: $1,550

Ripple XRP

Ripple has been involved in a downside from the start of the week to 12th may. Therefore, during the start of the week, the cryptocurrency was trading at the $0.86 price level.

Therefore, a downside was initiated which saw the cryptocurrency drop significantly below the $0.75 and the $0.70 level. Ripple went further to attain a low of $0.65 price level.

However, according to the current statistics, a rally has been initiated which has seen it attain a current high of $0.75 price level.

A continuous bullish trend might see ripple rally to the $0.80 price level and further to the $0.82 price level. On the downside, a drop below the $0.70 price level might attract losses and further drop to the $0.67 level.

Support level: $0.70

Resistance level: $0.80

Baseline

According to the price analysis, last week was faced with downsides which saw each cryptocurrency attain a low level below the support levels. However, as suggested in the price analysis, we should expect an upside which has already initiated.


 

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What central banks’ adoption of cryptocurrencies means for your investments

As cryptocurrencies become commonplace for business and finances, central banks are buying into them. Should retail investors follow suit?

Just a decade ago, cryptocurrency was a fringe concept that attracted disruptors eager to unsettle the foundations of the global economy. These days, it is a rapidly evolving asset class on the cusp of the mainstream. The change has been rapid and dizzying for most—including the central banks that are now struggling to keep up. Until recently, most financial institutions have been left out of the crypto space, acting as a foil to—not a part of—the burgeoning industry.

However, as more regulatory bodies around the world make small but steady moves to accept digital currencies, it seems central banks have no choice but to figure out exactly how crypto will fit into their business models moving forward. And in many cases, this doesn’t mean simply adjusting to these digital currencies—it means creating their own.

For instance, the fourth largest bank in the world, Japan’s Mitsubishi UFJ Financial Group, is about to issue a cryptocurrency of its own based on the blockchain ledger system that gives crypto the security and transparency it requires to be considered legitimate.

Similarly, Sweden’s central bank, Riksbank, is set to release a digital currency as early as this year, and in June 2017, it was reported that China’s central bank was “cautiously testing” a cryptocurrency as well.

Crypto could become a large component of the world’s transacting currencies, so it’s understandable that banks feel obliged to consider it. Right now, it’s hard to say how fast banks will be able to embrace it on a large scale—we know from experience that growth in the cryptocurrency sphere tends to be sudden, and a number of financial players could enter the scene seemingly overnight. As we move closer toward the point of mass adoption, we must ask: What does this mean for the average investor?

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How will central banks change cryptocurrency?

The decision of central banks to adopt cryptocurrencies has a range of consequences for investors—both good and bad. Once they begin buying coins in a real way, the price of the top currencies is likely to rise above even the astronomical heights many have already achieved.

That’s good news for retail investors, who will find it easier to access and engage with the cryptocurrency market with confidence. It will also make virtual coins easier to use in store, essentially legitimizing them as a transacting currency. Thanks to central banks, cryptocurrency will seem significantly less “shadowy” for investors reticent about diving into this asset class.

The influence of these banks, however, has the potential to transform the cryptocurrency marketplace as it is currently conceived. For instance, as they begin issuing their local cryptocurrencies—as we’re seeing in Japan, Sweden, and China—it could create a rift between “strong” and “weak” virtual coins.

Holders of such “weak” coins would eventually migrate to “strong” ones. As a result, fewer and fewer options would remain viable, and multiple countries could end up relying on the same cryptocurrencies. In the end, nations would have less ability to set interest rates and control inflation and prices.

How will central banks change investor perception?

Currently, many investors see cryptocurrency as an innovative, exciting opportunity. But they also see it as a confusing, complex risk that could cause huge amounts of wealth to disappear.

Central banks moving further into the crypto space should bolster confidence and eliminate doubt. Cryptocurrency will occupy a place in the mainstream, and investors will worry less about a specific currency or the industry as a whole collapsing overnight.

I would anticipate that over time, cryptocurrency markets will also become less volatile because banks and funds play an increasing role as investors and a significant portion of the market. Market forces should clean out the smallest and weakest virtual coins, leaving investors to choose between established options rather than shady operators.

The trick is for investors to determine which currencies they see have the highest likelihood of longevity, stability, and appreciation over the long haul. For instance, they should focus on coins with the highest market caps or those with the substantial marketing power pushing for their adoption, as they are most likely to be widely adopted and be sound investments in the long term.

Confidence in cryptocurrencies will only increase as the industry begins to adopt standards and best practices. Policies dictating cybersecurity, data retention, customer protection, and trading policies will eliminate uncertainty and inconsistency. This standardization will come from self-regulation to start, but as central banks become increasingly involved in the space, mandates from regulators could be coming down the pipeline.

From an investor’s perspective, the most recent evolution of cryptocurrency should be seen as a resounding positive. The number of trustworthy virtual coins is only going to increase, and the volatility of the market is likely to subside as a result. Cryptocurrencies will also become a transacting asset, rather than merely a trading one, which will only further increase adoption and make virtual currencies an even more appealing asset for investment.

As banks rush in to acquire a stake in the space, a domino effect is possible worldwide. The earliest cryptocurrency investors were willing to accept tremendous risk in the pursuit of tremendous potential rewards. Future investors, however, can feel confident about buying cryptocurrencies, knowing that the world’s largest financial institutions are investing as well.


 

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ZCash (ZEC) Announces Starkware Partnership

The ZCash (ZEC) project continues to struggle for prominence.

The latest news concern a partnership with an applied cryptography company, StarkWare Industries.

The company was founded by former ZCash developers and scientists professor Eli Ben-Sasson and professor Alessandro Chiesa. Now, the early developers return as advisors and partners to the ZCash project, attempting to unroll the STARKs technology for anonymization.

Zero-knowledge (ZK) proof systems are already used on ZCash, in the form of ZK-SNARKs, and the StarkWare company plans to introduce an alternative workup.
Price Continues to Sink

ZEC has always been a niche coin, and somehow missed a more dramatic appreciation. The digital asset has received both accolades and criticisms, the latter coming from the Monero community.

Due to its low supply, ZEC has always commanded a relatively high price, but now the asset continues to slide below $300. In the past week, ZEC sank more than 16% to $259.43.

Zcash Company

Going to #Consensus2018? Don’t miss the good stuff! Turing Award winner and cryptography legend @WhitfieldDiffie and @zooko will discuss the implications of the widest deployment of public key cryptography ever known. Monday, 5:20pm.

It is unknown whether the Consensus 2018 event would bring a change of tides for the price. The event was recently boycotted by Vitalik Buterin for being connected to a potential exposure of users to an airdrop scam.

The biggest disadvantage for the ZEC asset is the inactive trading. Due to the high price, few investors jump in, as they would into cheaper coins. Also, the coin’s marketing is directed to large-scale investors, and ZEC has so far hovered locked within a range, not achieving rapid growth that would introduce panic-buying.

Recently, a team of British scientists tested the ZCash system, and discovered that users were compromising their privacy through address usage. Using a mix of transparent and shielded address makes ZEC transactions easier to trace, or at least reveal patterns of usage.

Additionally, the ZCash team faces research and a decision on the Antminer Z9 ASIC. Part of the community supports an ASIC-disabling fork, and threatens to leave the project in case large-scale ASIC mining is allowed to continue.


 

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Ethereum Futures Go Live on UK Trading Platform

Digital asset trading service Crypto Facilities is launching ethereum futures contracts.
Announced Friday, the U.K. startup claims the news marks the first time futures for ether – the cryptocurrency that powers the ethereum blockchain – will be traded on a regulated platform. Investors will be able to take long or short positions, which will let them “broaden investment opportunities and manage risks more effectively,” according to the firm.
In a statement discussing the new offering, Crypto Facilities chief executive Timo Schlaefer noted that ether is the second-most liquid cryptocurrency after bitcoin, with a daily trading volume in the excess of “billions of dollars.”
Schlaefer added:
“We are excited to be launching ETH futures. The ethereum network is the pre-eminent blockchain for smart contracts, and we believe this new trading instrument will attract more investors and bring greater liquidity to the marketplace.”

The company will work with liquidity providers Akuna Capital and B2C2 to help back its contracts. Akuna’s head of digital assets, Toby Allen, said in a statement that his firm was “looking forward to seeing this much-needed product fill a gap in the market.”
The creation of an ethereum futures contract is “another giant leap in the development of the crypto asset class,” he added.
B2C2 founder Max Boonen similarly called the move “a natural next step” for ethereum’s token.
“The continuing evolution and commoditization we’re seeing in ethereum will further increase liquidity in the marketplace, enabling participants to exchange assets seamlessly and unlock value. We look forward to providing liquidity for this new product,” he said.
Stepping back, this is not the startup’s first touch with futures products. Crypto Facilities already offers bitcoin and XRP futures contracts, as previously reported by CoinDesk.
Moreover, the firm provides CME Group with the CME CF Bitcoin Reference Rate, which the Chicago-based exchange uses to offer its bitcoin futures contracts.


 

Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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UK growth falls to five-year low, Bank of England seen delaying rate hike

LONDON

Britain’s economy suffered its weakest growth since 2012 in early 2018, with heavy snow only partly to blame, prompting investors to slash their bets on a Bank of England rate rise next month.

Britain’s economy grew by just 0.1 percent in the first quarter of 2018, well below the BoE’s prediction of 0.3 percent and at the bottom end of economists’ forecasts in a Reuters poll, official data showed on Friday.

Sterling tumbled by more than a cent against the U.S. dollar GBP=D3, and interest rate futures more than halved the chance of a May rate rise to less than 20 percent BOEWATCH.

“A very weak Q1 GDP print has ended the chances of a rate hike in May. For us, it means no hike at all in 2018,” John Wraith, a market strategist at UBS, said.

In year-on-year terms, growth slowed to 1.2 percent from 1.4 percent, its weakest since the second quarter of 2012 and a rate likely to keep Britain lagging behind its international peers.

A spokesman for Prime Minister Theresa May said the numbers were “clearly disappointing”, but played down suggestions that uncertainty over Brexit was to blame.

The slowdown from already modest quarterly growth of 0.4 percent in the fourth quarter of 2017 was driven by a sharp fall in construction output.

Unusually heavy snow storms in late February and early March, dubbed “the Beast from the East”, were known to have hurt some businesses before Friday’s data. But the Office for National Statistics said the problems went beyond that.

“While the snow had some impact, particularly in construction and some areas of retail, its overall effect was limited with the bad weather actually boosting energy supply and online sales,” ONS statistician Rob Kent-Smith said.

Consumer-facing businesses also slowed in the first quarter, the ONS said, probably reflecting higher inflation.

The pound’s fall after the June 2016 Brexit vote eroded households’ disposable income throughout last year.

The pound’s fall after the June 2016 Brexit vote eroded households’ disposable income throughout last year.

The scale of the slowdown may unsettle the BoE’s Monetary Policy Committee (MPC), which next week begins considering whether to raise rates on May 10 for only the second time since the 2008 financial crisis.

However, some BoE policymakers have said early estimates of first-quarter GDP are often revised up – on average, by 0.3 percentage points – particularly at times of harsh weather.

“If the MPC wants to look through this number and hike they can justify it – they just have a challenge selling it to the man and woman on the street,” Scotiabank economist Alan Clarke said.

A key factor will be whether April purchasing managers’ surveys next week rebound from weak March readings. If they are similar to data this week from the Confederation of British Industry, the recovery may be limited.

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RATE HIKE ODDS LENGTHENING

Until recently, most economists were predicting that the BoE would not be swayed by weak first-quarter data because inflation is running above its target and the unemployment rate is the lowest since 1975.

Two of the BoE’s nine policymakers voted to raise rates to 0.75 percent in March, saying the economy was running at close to full capacity – a view largely shared by their colleagues.

But many economists had begun to think the BoE might be getting cold feet about a May rate rise after Governor Mark Carney alluded to “mixed” data last week and the possibility of moving rates at a later meeting.

Markets now price in just one rate rise for 2018, probably by August and almost certainly by November.

UBS’s Wraith said he thought the economy would slow further, and that the BoE would be unable to raise rates later this year.

“Brexit-related anxiety is a headwind that is blowing more strongly as time goes by,” Wraith said.

In the final three months of 2017, Britain recorded the slowest year-on-year growth of any major advanced economy. For this year, the International Monetary Fund predicted last week that Britain would move ahead of Japan and Italy.

Britain’s preliminary GDP data – which only has 40 percent of the figures used to calculate the final estimate – precedes most other European numbers. But the French statistics agency has estimated French GDP growth fell to 0.3 percent during the first quarter from 0.7 percent in the quarter before.


 

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Take Five – World markets themes for the week ahead

LONDON

Following are five big themes likely to dominate thinking of investors and traders in the coming week and the Reuters stories related to them.

1/PATIENT, PERSISTENT, PRUDENT

ECB chief Mario Draghi has good reason to stick to a mantra of PPP – patience, persistence and prudence – when the central bank meets on Thursday. Since the ECB’s March meeting, economic data has disappointed, inflation estimates have been revised lower and a global trade spat may loom.

ECB policymaker Francois Villeroy de Galhau has already said the bank may have to alter its march toward a more normal policy stance if protectionism, exchange rates or market swings end up depressing inflation. Flash Purchasing Managers’ Index reports due on Monday will show if the run of soft data — after a record 18 quarters of uninterrupted growth — is continuing.

Economists anticipate that ECB steps towards winding down QE will come only in June or later. But Draghi will be pressed on what he thinks about the economic wobbles, trade wars and the euro. In trade-weighted terms, the euro remains less than one percent below a 3-1/2 year high hit on March 8, the last time the ECB met.

2/FAANGS-TASTIC

The FAANG group of stocks — Facebook, Amazon.com, Apple Inc, Netflix and Google parent Alphabet Inc — have tended to move together in the past, but of late their fortunes have diverged: Amazon shares have risen 33 percent this year, Google and Apple have chalked up single-digit gains and Netflix is up a whopping 72 percent.

Facebook shares are at the other extreme, having fallen 6 percent, hit by fears of tighter regulation and slowing advertising revenue growth after a data privacy scandal.
FAANG-topper Netflix has set the results bar high as well, with corporate earnings on track to rise 19.7 percent for the first quarter, their highest increase in seven years.

Now attention turns to the others. Investor interest is running high in Facebook which reports earnings next Wednesday. Google and Amazon will post their results on Monday and Thursday and investors are hoping that earnings growth and forecasts will be strong enough to bring the FAANGs back into favour.

3/SUCCESSOR-NOMICS

Public support for Japanese Prime Minister Shinzo Abe, the architect of Abenomics — reforms that have lifted growth and corporate profits while weakening the yen — has never been this low. Chances are he will not be re-elected leader of the ruling party, yet investors appear unfazed.

The Nikkei volatility index and implied yen volatility are at their lowest in almost three months. But latest data shows consumer inflation slowed in March to 0.9 percent, stubbornly below the Bank of Japan’s 2 percent target. The question is, if Abe leaves, would his successor have any better ideas than to continue on the path he has set?

The answer may lie at the central bank, which meets on Thursday and Friday. Its governor Haruhiko Kuroda, the man behind the monetary stimulus, was reappointed this year and would therefore survive beyond an Abe exit. While no policy change is expected, the BOJ’s forecasts on inflation will be crucial; sources say it will maintain its view on hitting the target in 2019.

And if Kuroda reassures markets the BOJ is nowhere near an exit from ultra-loose monetary policies, investors will stay unruffled by all the doubts about Abe’s political future.

4/CRUDE: BARRELS OF FUN

European oil majors Shell, Total, Statoil and Eni, and U.S. oil producers Exxon Mobil and ConocoPhilips are all due to report next week.

Crude’s surge to 2014 highs is a boon to oil companies’ bottom line and is supporting share prices but it could also be approaching the point where it starts amplifying inflation.

It is on the radar of U.S. President Donald Trump for sure, inducing him to tweet on Friday that oil prices were being kept “artificially” high by OPEC and this “will not be accepted”. While his tweet sent oil prices lower, they remain just below $73 per barrel, a 9 percent gain in 2018.

Will inflation start to become a concern for investors? They are already hyper-sensitive to any sign inflationary pressures are denting consumer confidence in this late-cycle environment. Bond prices have reacted with minor move upwards but it hasn’t ruffled too many feathers.

Investors in oil stocks, on the other hand, are in a heightened state of anticipation ahead of the big companies’ first-quarter results, which some expect to deliver the strongest cash flow figures in a decade.

5/IT’S A SNAP!

A snap election in Turkey and U.S. sanctions on Russia are seen influencing central bank policy in both countries next week. Turkey is now seen as very likely to raise interest rates at its meeting on Wednesday, while Russia’s Friday meeting may have to hold off cutting rates any further.

With Turkey’s election set for June, expectations are the central bank will at last be able to act on tackling double-digit inflation, the assumption being the government won’t want to go to the polls with a currency in freefall.

The lira has firmed more than 3 percent off record lows since the announcement.
In Russia, inflation is well below target but the rouble’s 6 percent slump to the dollar in the wake of new U.S. sanctions imposed on April 6 has fuelled concerns of pass through to prices.

Having earlier flagged rate cuts, policymakers are now signalling a “hold”, warning of higher inflation expectations. Their take on inflation will be in focus next week as will any comment on the rouble outlook.


 

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IEA says “mission accomplished” for OPEC as oil stocks shrink

LONDON

OPEC and its allies appear to have accomplished their mission of reducing global oil stocks to desired levels, the International Energy Agency said on Friday, signalling that the market could become too tight if supply remains restrained.

The IEA, which coordinates the energy policies of industrialised nations, said stocks in developed countries could fall to their five-year average – a metric used by OPEC to measure the success of output cuts – as early as May.

“It is not for us to declare on behalf of the Vienna agreement countries that it is ‘mission accomplished’, but if our outlook is accurate, it certainly looks very much like it,” the IEA said in its monthly report.

Vienna-based OPEC has reduced production in tandem with Russia and other allies since January 2017 to prop up oil prices, which soared above $70 per barrel this month, giving a new boost to booming U.S. output of shale oil.

Reuters Graphic

 

GRAPHIC: OECD stocks vs. five-year average

Reuters Graphic

GRAPHIC: Stocks as days of forward demand vs. five-year average

But as oil production has collapsed in OPEC member Venezuela and still faces hiccups in peers such as Libya and Angola, the oil exporter group is producing below its targets, meaning the world needs to use stocks to meet rising demand.

On Thursday, the Organization of the Petroleum Exporting Countries said in a monthly report that oil stocks in the developed world were only 43 million barrels above the latest five-year average. The Paris-based IEA put the figure at just 30 million barrels as of the end of February.

The IEA said that even though non-OPEC output was set to soar by 1.8 million barrels per day this year on higher U.S. production, it was not enough to meet global demand, expected to rise by 1.5 million bpd or around 1.5 percent.

OPEC was producing 31.83 million bpd in March, below the call on its crude for the rest of the year at 32.5 million bpd.

“Our balances show that if OPEC production were constant this year, and if our outlooks for non-OPEC production and oil demand remain unchanged, in 2Q18-4Q18 global stocks could draw by about 0.6 million bpd,” the IEA said.

The figure would represent 0.6 percent of global supply or around half of OPEC’s current production cuts of nearly 1.2 million bpd.

The output-limiting pact runs until the year-end. OPEC meets in June to decide its next steps. The organisation’s de facto leader, Saudi Arabia, has said it would like the agreement to extend into 2019.

OPEC Secretary-General Mohammad Barkindo told Reuters on Thursday OPEC and its allies were poised to extend the pact into next year even as a glut of crude should evaporate by September.

“OPEC is within rapid reach of its first announced goals and will have to come up with a new metric for the June meeting if it wants the agreement to last into the second half of the year,” said Olivier Jakob from Petromatrix consultancy.

Qatar’s energy minister told Reuters last week that even though stocks around the world were falling, an investment drought continued to afflict the oil industry and hence the price of crude could spike in the long run.

Analyst John Kemp argues that recent statements from OPEC members indicate the organisation appears to be reformulating its target in terms of upstream investment rather than inventories.


 

Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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Author Dmitry Zhdannikov

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FTSE gets boost from miners as global trade tensions ease

LONDON

A recovery in mining stocks helped Britain’s top share index climb to a one-month high on Tuesday, as concerns around global trade continued to ease.

The blue chip FTSE 100 .FTSE index was up 0.4 percent at 7,222.80 points by 0826 GMT, while mid caps .FTMC also rose 0.4 percent.

The materials sector was the biggest contributor to gains, adding around 13 points to the index, recovering following some large losses in the previous session when stocks with exposure to Russia were hit after the United States unveiled new sanctions on Russian officials, oligarchs and their companies last week.

Shares in Evraz (EVRE.L), a Russian steel producer which plunged 14.5 percent in the previous session, recovered some of those losses to trade 3.9 percent higher.

Likewise Glencore (GLEN.L) rose 2 percent after the mining giant suspended a deal to swap its shares in Russian aluminium producer Rusal for Global Depository Receipts in EN+ due to the sanctions.

Both Rusal and EN+ (ENPLq.L) were targeted by the U.S. measurers.

“Glencore shares were hit, but we think that the market has overreacted – in a worst-case scenario the foregone business from Rusal volumes is worth around 0.9 percent of 2018 (estimated) EBITDA, whilst if the Rusal stake on the balance sheet (US$933m) is worth zero, this would be around 1.3 percent of Friday’s market cap,” wrote Bernstein mining analyst Paul Gait in a note.

More broadly, stronger metals prices and a rise in oil on the back of easing concerns over global trade underpinned the FTSE’s commodities-related stocks.

Last week risk assets were hit by an escalation in tensions between the United States and China, with investors worried that the tariffs would leads to a full-blown trade war.

However, a promise from Chinese President Xi Jinping to lower import tariffs on products such as cars helped soothe market nerves.

“President Xi’s speech overnight appears to have struck the right tone, providing some relief for investors who have been buffeted by the recent war of words between Trump and China over trade,” said Rebecca O’Keefe, head of investment at Interactive Investor.

Elsewhere, shares in Burberry (BRBY.L) rose 2.4 percent, buoyed by a well-received first quarter sales update from French luxury peer LVMH (LVMH.PA).

British greeting card retailer Card Factory (CARDC.L) topped the gainers among mid cap stocks .FTMC, its shares rising 6.6 percent after reporting a rise in annual sales and saying that it planned to declare a special dividend in September.


 

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Author Kit Rees

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