Oil Prices Rise Following OPEC’s Downgrade of Global Demand Forecasts
Oil prices increased after OPEC decided to revise its forecasts for global oil demand for this year and the next.
The major U.S. stock indices closed the first session of the week with mixed results as investors assessed the possibility of imminent interest rate cuts by the Federal Reserve, according to CNBC.
The Dow Jones Industrial Average, a benchmark for blue-chip stocks, fell by 0.36% to 39,357.01 points. Meanwhile, the broader S&P 500 index held steady at 5,344.39 points.
The tech-focused Nasdaq Composite gained 0.21% to reach 16,780.61 points. The market attempted to maintain the momentum from the previous week as investors awaited new inflation data, which is expected to shed light on the timing for the Fed’s monetary policy easing.
“We are optimistic that a short-term bottom was reached or is close to being reached on August 5,” commented Lori Calvasina, head of equity strategy at RBC Capital Markets.
Nvidia’s stock price surged by over 4%, although some investors began to exercise caution when trading shares of companies in the artificial intelligence sector. Despite a decline of more than 11% in Nvidia’s stock during the third quarter, it is still up 121% year-over-year.
Meanwhile, shares of Alphabet and Amazon decreased by 1% and 0.29%, respectively, while Tesla’s stock lost 1.34% of its value.
On the bond markets, the yield on 10-year and 30-year U.S. Treasury bonds fell to 3.905% and 4.201%, respectively. The dollar index reported a slight decline of 0.01% to 103.13 points.
In the oil markets, Brent crude prices rose by 2.82% to $81.91 per barrel, while U.S. West Texas Intermediate (WTI) crude advanced by 3.64% to $79.64 per barrel. These price movements reflect OPEC’s decision to lower its forecasts for global oil demand for this year and next, ahead of the group’s planned discussions with its allies, known as OPEC+, regarding a scheduled increase in supplies for the upcoming quarter.
The organization has reduced its expectations for global demand growth in 2024 by 135,000 barrels per day.
Gold Prices Rise Significantly
The price of gold has increased by approximately 1%, reaching $2,497.40 per ounce. This notable rise reflects a significant shift in market dynamics.
This change is particularly striking when compared to the forecasts of other players in the oil industry, which remain considerably lower.
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