This week several regions seemed to have entered the coldest part of winter so far. The cold is spreading throughout Europe and North America, with the latter especially affected. The US Sun Belt that rarely ever gets snow is currently in the grips of an Arctic freeze that has left many oil refineries out of commission.
However, the slowdown in the US oil industry caused by the bad weather is not having a positive effect on the oil market. Oil prices remain below the recent maximums, with Brent trading near $63.13 and the WTI at $59.80 per barrel.
Other commodities that are doing better than oil include metals, especially those of high industrial significance such as copper and platinum. Both instruments hit multi-year highs today; this growth is in line with many experts’ forecasts for 2021, which predict that metals like these will rally for a while yet.
US stock indices today will open in the green and continue extending their recent rally. The financial markets have been reassured that Joe Biden’s stimulus plan will deliver a solution to the economic crisis soon and that Covid-19 is coming under control around the world. This mood is fueling risk appetite.
The US dollar continues to weaken in the context of the above-mentioned factors. Currencies making gains against the USD include the euro, the pound, as well as the Australian and New Zealand dollars.
Bitcoin and other cryptocurrencies also continue their steady growth. Recent actions by Tesla CEO Elon Musk have prompted the belief that more investors will diversify their portfolios with cryptocurrencies, granting them more acceptance in the financial markets.
Today the economic calendar is a bit busier than yesterday. This morning France reported an unemployment rate of 8% in Q4 of 2020, which is better than anticipated. However, GDP data from the Netherlands was disappointing, indicating that one of the richest EU member states struggled more than expected at the end of last year.
Still, eurozone-wide GDP data was better than the forecasts, as were the ZEW economic sentiment surveys for the eurozone and Germany for February. This is going to further boost the euro today.
