Global Stocks Recover After Sharp Fall In Oil Prices
Global Stocks Recover After Sharp Fall In Oil Prices
Stocks rose on Friday after a sharp fall in oil equilibrium price yesterday on expectations that Saudi Arabia could offset any shortfall in oil production in Libya.
The catalyst for the drop in oil prices Thursday were expectations that Saudi Arabia's largest oil exporter, pumping more oil to compensate for the loss of supplies from Libya, which is actually divided into two after a popular uprising.
Under normal circumstances Libya produces about 1.6 million barrels per day, but production was strongly affected by the violence that has claimed nearly 300 lives, according to a partial census of Human Rights Watch.
In London, Brent crude rose 15 cents to 111.51 dollars a barrel, $ 8 or more below its peak on Thursday. Meanwhile, similar to New York, fell 7 cents to 97.23 dollars a barrel, again about $ 5 more than the previous day.
The same seems to be a positive for stocks, as investors seemed relieved that the recent sharp rise in oil prices has stopped, but a glance the fear is that oil prices are difficult to stifle the fragile economic recovery around the world.
Europe, Germany's DAX closed 0.8 percent one hundred years 7,185.17 while the Paris CAC-40 rose 1.5 percent 4,070.38. UK FTSE 100-index of the most important part of the British closed 1.4 percent higher at 6,001.20, after earlier trading continued in the following technical problem which ended up accounting for about four hours.
In the U.S. the Dow Jones Industrial Average 0.4 percent to 12,114 around noon New York time, while the broader Standard & Poor's 500 futures rose 0.8 percent to 1316th
Libya was probably continue to dominate the feeling that the week ending nervous trading.
With reports of escalating violence in the capital Tripoli, and most of the country under the control of opposition groups, there is concern that long-Gaddafi can prepare for a bloody showdown.
autocratic leaders of Egypt and Tunisia have already done this year, a mass popular uprising.
The primary markets, not Libya, but the spread of the crisis in the Persian Gulf are major energy producers. Bahrain government already faces daily demonstrations and there are fears that the royal family in Saudi Arabia, the next in line to deal with angry people. The announcement of a massive $ 36 billion package of benefits earlier this week was seen as an attempt by Saudi King Abdullah to ease popular discontent.
"If the unrest spread to the world's largest producer of oil markets to discuss the possibility of another oil crisis and its impact on the global economy," said Ashley Davies, an analyst at Commerzbank.
If the crisis is here, experts say oil prices could reach 200 dollars a barrel, which can show the world economy into recession.
The fragility of global economic recovery have highlighted the fact that Britain has become more than expected 0.6 percent in the last three months of 2010, but the annual growth in the United States during the same period was revised downwards from first estimate of 2.8 percent was 3.2 percent.
As elsewhere, the main emphasis on the foreign exchange market on events in Libya and the decline in oil prices to their highest level against the U.S. dollar, despite a weaker increase the numbers expected growth States United States States.
Elsewhere, the euro was 0.4 percent, to $ 1.3756 while the dollar fell 0.2 percent to 81.75 yen.
In Asia, the Japanese Nikkei closing average increase of 225 percent to 0.7 10526.76 and the Kospi in South Korea have also added 0.7 percent, to 1,963.43. Hong Kong Hang Seng Index rose 1.8 percent to 23,012.37.
The Shanghai Composite Index remained virtually unchanged at 2,878.57 and down 0.7 percent during the week in Shenzhen Composite Index edged up less than 0.1 percent to 1,280.30 in lackluster trade.
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