Fiona Cincotta May 18, 2020 10:19 AM
The week is starting with some fresh optimism as investors take some reassurance from comments by Fed Chairman Jay Powell about a steady recovery ahead.
The week is starting with some fresh optimism as investors take some reassurance from comments by Fed Chairman Jay Powell about a steady recovery ahead. A closer inspection of his speech shows that his view still remained cautious but he no longer mentions potential economic turmoil ahead, which is something he spoke about only a week ago.
Resources companies are leading the way higher on the FTSE with Anglo American, BHP Group and Rio Tinto all rallying by over 5%. Oil firms and power utilities are also among the top gainers now that Brent crude has firmed up 3.8% and WTI more than 5%.
With only one day to go until the expiry of the WTI June crude oil contract there are no signs that prices will repeat their performance from last month and plunge below zero. A new pledge from Saudi Arabia of an additional production cut and a record low rig count in the US are beginning to convince investors that the worst of the oil glut may be over, particularly as more and more regions are beginning to reopen.
Normality seems to be returning
From today some Italian regions will be allowed to open shops, bars and restaurants and travel in and out of the country will restart from 1 June.
Normality is also returning on a deeper level now that Italian, Spanish and French securities regulators have removed the ban on short-selling.
Refreshingly, there are only three FTSE stocks in the red this morning: Ocado, Tesco and Auto Trader Group.
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