Stock markets recover ground and oil collapses after days of rising

Wall Street and European stock markets rebounded strongly this Wednesday, while oil fell sharply, after a gesture of diplomatic opening by the Ukrainian president, Volodimir Zelenski, in the midst of the war in his country.

The New York stock market ended with a strong rebound, its best day so far this year, driven by a brutal drop in oil prices caused by Zelensky’s statements.

At the closing bell, the Dow Jones rose 2.00% to 33,285.09 points, the Nasdaq 3.59% to 13,255.55 points, and the S&P 500 2.57% to 4,277.86.

Meanwhile in Europe, the stock markets of Frankfurt and Paris registered rises of 7.9% and 7.1% respectively, in a movement in search of opportunities after several sessions in decline.

The FTSE index in Milan rose 6.9%, the Ibex 35 in Madrid gained 4.8% and the FTSE 100 in London 3.3%.

The head of state of Ukraine told the website of the German newspaper Bild that “compromises” could be reached for a diplomatic solution to the conflict in his country. These commitments are “the only way out of this situation,” he added.

Zelenski had affirmed on Monday that he no longer insists that Ukraine join NATO, one of the issues used by Russia to invade his country, in an interview broadcast by the American channel ABC.

And, in another apparent gesture of openness to Moscow’s demands, Zelensky said he was willing to reach a “compromise” on the status of the separatist territories in eastern Ukraine, whose independence the Russian president unilaterally recognized just before launching the war. in February.

oil down

Oil and gas prices fell sharply on Wednesday, in part as investors believe the threat of a European embargo on Russian hydrocarbons is receding.

Both the United States and the United Kingdom announced an embargo on the import of Russian oil and gas on Tuesday.

In contrast, the countries of the European Union, which receive approximately 40% of their gas imports from Russia and a quarter of their oil imports, chose to set the objective of reducing their imports of Russian gas by two thirds.

A barrel of North Sea Brent for May delivery fell 13.15% to US$111.14 in London, while New York-listed West Texas Intermediate (WTI) fell 12.12% to US $108.70, following Zelensky’s comments to Bild.

Comments from the ambassador of the United Arab Emirates to the United States, Yussef Al Otaiba, also contributed to these closing values, who declared that the Emirates are “favorable to an increase in production” of oil and will “encourage” in this sense the OPEC.

Robert Yawger, head of futures contracts at Mizuho Securities, believes the Emirates’ decision will put “pressure on the Saudis to do the same.”

The Emirates and Saudi Arabia are among the few members of OPEC and their allies gathered in Opec+ to have idle production capacity, and while the Emiratis could contribute an additional 800,000 barrels per day, the Saudis could supply some two million barrels per day to the market, according to the analyst.

AFP