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|12 July, 2018

Oil prices regain some ground after Wednesday's drop

Brent crude rose $1.31, or 1.8%, to $74.71

Oil prices

Oil prices recorded their biggest one-day loss in two years on Wednesday on news that Libya would resume oil exports and trade tensions between the United States and China.

Early on Thursday, oil prices recovered some of the previous session’s losses.

Brent crude rose $1.31, or 1.8 percent, to $74.71 by 0242 GMT after slumping 6.9 percent on Wednesday.

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U.S. West Texas Intermediate (WTI) added 42 cents, or 0.6 percent, to $70.80, after falling 5 percent the previous session.

“Markets in Asia are a lot more settled today,” Greg McKenna, chief market strategist at AxiTrader in Sydney, told Reuters.

“Moves, the like of which we saw in Brent and to a lesser extent WTI, last night are often followed by some sort of bounce the following day or session,” he said.

Global markets

Stock markets bounced back on Thursday after Wednesday’s drop following trade tensions between the United States and China.

MSCI’s broadest index of Asia-Pacific shares outside Japan inched up 0.05 percent, after dropping 1 percent on Wednesday.

“The markets had some time to digest the latest trade war developments and are poised to begin consolidating. It has become a pattern of reacting to each new development and hoping that trade strains ease in the next few months through negotiations,” Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management, told Reuters.

Middle East markets

Stock markets in the Middle East were mixed on Wednesday, with sentiment hurt by a drop in oil prices.

Dubai’s index edged down 0.1 percent as property shares weighed on the index with Emaar Properties falling 2.2 percent and DAMAC Properties losing 1.0 percent.

Abu Dhabi’s index rose 0.5 percent, supported by First Abu Dhabi Bank (FAB), which gained 1.2 percent, Emirates Telecom (Etisalat) up 0.6 percent and Abu Dhabi National Energy (TAQA) added 4.1 percent

Saudi Arabia’s index fell 0.4 percent as Samba Financial Group dropped 2 percent and Banque Saudi Fransi, fell 1.9 percent.

Jarir Marketing closed up 1.0 percent after reporting an estimated 10 percent increase in second quarter profit.

Qatar’s index dropped 0.4 percent. Commercial Bank fell 2.4 percent and Qatar Islamic Bank shed 1.5 percent. Petrochemicals, metals and fertiliser producer Industries Qatar lost 1.1 percent.

Egypt’s index rose 0.2 percent, Kuwait’s index rose 1.4 percent while Bahrain’s index added 0.8 percent and Oman’s index dropped 1 percent.

Currencies

The dollar was steady in early trading on Thursday.

Against a basket of six major currencies, the greenback was trading at 94.725, near a one-week high of 94.769 reached overnight.

Against the yen, the dollar edged up 0.1 percent, trading at 112.07 yen after breaking through the 112 barrier for the first time since January 10 in U.S. trade. The dollar had gained as much as 1.3 percent on Wednesday to 112.175 yen.

Precious metals

Gold prices were steady on Thursday.

Spot gold held steady at $1,241.20 an ounce at 0100 GMT. The yellow metal slipped 1 percent and hit an over one-week low at $1,240.89 on Wednesday.

U.S. gold futures for August delivery were 0.2 percent lower at $1,241.60 an ounce.

(Writing Gerard Aoun; Editing by Shane McGinley)
(gerard.aoun@thomsonreuters.com)

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