Asian Shares, Oil Prices Rise As Dollar Struggles
Asian shares hit 21-month highs during Tuesday’s morning session following signs of economic growth, despite lower closes on Wall Street on Monday as traders worried that President Trump’s proposed economic stimulus and tax cuts would take longer than expected. MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.4 percent in early trade to hit 21-month highs, lifted significantly by gains in Hong Kong and South Korea.
The dollar eased to near three-week lows on Tuesday morning, hitting 112.26 yen. The euro also continued its gains against the greenback, hitting $1.0758, piggybacking on gains from the settling of last week’s Dutch election which thwarted the populist leanings in the country. The dollar index rose slightly on Tuesday to 110.26 .DXY after hitting a fresh six-week low on Monday.
Oil Prices Bounce Back
Brent crude prices hit $51.86 per barrel on Tuesday morning, up 0.5 percent on hopes that OPEC would extend its production cuts as demand continues to rise. U.S. WTI crude futures gained 0.3 percent to trade at $48.35 per barrel. Despite OPEC’s commitment to curb output by 1.8 million barrels per day, crude prices have plummeted more than 10 percent since the start of 2017. To reverse this trend, OPEC members have expressed interest in extending the production cuts beyond the original deadline of June to help regain control of oil prices. Current prices have been controlled largely by the U.S. whose continued production increases have counterbalanced OPEC’s calculated efforts. Future OPEC production cuts would likely be hinged upon non-OPEC producers such as Russia to increase their efforts as well.
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