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Firmer oil price supports risk appetite 

April 13, 2016

Financial Times

Oil prices rose sharply on hopes of a production freeze, bolstering US and European equities as investors remained hopeful at the start of a challenging earnings season from S&P 500 companies.

Trading in commodities was dominated by firmer oil prices. Brent crude, the international energy benchmark, climbed to a four-month high of $44.63, up 4.2 per cent ahead of the world’s largest energy producers’ meeting this weekend to discuss a production freeze.

Broader risk appetite for equities in Europe and New York was nurtured by firmer oil prices. After an early wobble on Wall Street, the S&P 500 closed up 1 per cent to 2,061.

Wall Street’s positive showing came in spite of Alcoa unofficially starting the US first-quarter corporate earnings season with a downbeat profit forecast.

The aluminium producer is the first high-profile company to report on what is expected to be a poor quarter for US profits, with S&P 500 constituents in aggregate reporting an 8.3 per cent decline in earnings a share compared with the same period in 2015, according to S&P Global Market Intelligence. Read more

 
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