A bad week for Farage
European stocks are in the green on the final trading day of the week, bringing an end to a data-heavy and yet, rather uneventful week.
Here in the UK, everyone is in election mode and Brexit Party leader Nigel Farage has been the centre of attention. Farage is no stranger to the limelight and let’s face it, he loves nothing more than everyone fussing about him and what he has to say, but this has not been his week, much to the delight of Boris Johnson and the Conservatives.
From proposing an alliance with the Tories, to entering it unilaterally in the 317 seats they currently hold in the hope of the favour being returned, to once again being rejected and some candidates pulling out in fear of putting Brexit at risk altogether, it’s not been a week to remember for Farage and his party.
The Conservatives have been given a poll boost by Farage’s concessions but they’ll need him to go further and not contest the marginal leave seats they harbour a chance of winning. This may come at the cost of pulling from leave seats they hold little chance of taking but there’s little interest to engage with Farage right now. There’s not long for them to change their minds though and stubborness on both sides could ultimately cost the UK Brexit altogether, the irony.
Kudlow the latest to express trade optimism
On the global stage, it’s been all about the trade war this week. Not because anything has fundamentally changed, it hasn’t, rather both sides have felt the need to provide a constant flow of contradictory comments to keep us on our toes. Both want a deal done it seems but late concessions are being demanded which could ultimately jeopardize everything.
Larry Kudlow is the latest US official to express optimism over a deal, although issues clearly exist around tariffs and Chinese purchases, not to mention when and where any deal will be signed. A signing ceremony this year looks difficult at this stage but investors are being swept up by the positive words regardless.
Gold reverses near major resistance
Gold prices are pulling back a little this morning having recovered some ground in recent days. We didn’t quite get to the point of testing major resistance, around $1,480, but we could still see a run at that over the next week.
Fed Chair Powell offered nothing of note this week, just a rehash of previous comments and no commitment either way heading into a new decade. Pressure will remain on him from the White House but he must be used to that by now. In the meantime, gold may continue to soften as it pares the summer gains, with $1,400 being an interesting area below.
Oil rally stalling
Oil prices are edging higher on Friday, in line with gains we’re seeing across other risk assets. Oil prices fell more than 1% on Thursday as EIA reported a surprise 2.2 million increase in crude inventories.
Crude oil prices are still lingering around their highs though although the rally has certainly stalled. Perhaps this is now looking a little more prone to a correction than it has in recent weeks, especially having run into an area that was previously significant support and resistance.
Disclaimer: This article is for general information purposes only. It is not investment advice, an inducement to trade, or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. Ensure you fully understand all of the risks involved and seek independent advice if necessary. Losses can exceed investment.