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Crude jumps after weekend attack - CMC Markets

Fuseworks Media
Fuseworks Media

By Michael McCarthy, chief market strategist, CMC Markets and Stockbroking

Brent crude oil contracts jumped more than 20% at the Asia Pacific opening this morning. The buying follows a co-ordinated drone attack on two major oil facilities in Saudi Arabia over the weekend. The rise in geo-political risk is lifting the US dollar, but forex traders are scrambling for commodity currencies. The New Zealand and Australian dollars are up around 0.5% against the Japanese yen.

The focus on growth assets continues, at the expense of bonds. A trade thaw, better than forecast US retail sales and a surprisingly modest fall in UK house prices in September supported higher investor risk appetites in Friday night trading. China data today could dominate the session as retail sales, industrial production data and a jobless survey hit the wires.

Gold markets continue to flash warnings. The yellow metals has climbed back over $1,500 an ounce despite a stronger US dollar.

Lower local currencies are in focus as dairy food group Bellamy’s announced a scheme of arrangement with China Mengniu Dairy Company. The takeover proposal is at $12.65 per share plus a $0.60 dividend. The total value of the deal is around 60% higher than the last traded share price. Bellamy’s board recommends shareholders accept the deal.

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