Oil hovers at eight-week nadir on tariff concerns
Global oil prices fell in American trade on Tuesday, resuming losses and almost touching eight-week lows on concerns about Trump’s tariffs and their impact on the global economy.
Now traders await initial data on US crude stocks from the American Petroleum Institute, expected to show the sixth weekly buildup in a row.
Prices
US crude fell 1.1% to $70.10 a barrel, with a session-high at $71.22.
Brent shed 0.9% to $74.20 a barrel, with a session-high at $75.22.
On Monday, US crude rose 0.85% away from eight-week lows at $70.04 a barrel, while Brent climbed 0.8% away from December 31 lows at $74.15.
Trump’s Tariffs
US President Donald Trump said the tariffs on Mexican and Canadian imports, scheduled to be implemented on March 4, will be enforced, despite ongoing talks between the three countries to reach a compromise.
Analysts believe the tariffs will impact global growth negatively and in turn hurt oil demand.
New US Sanctions
US President Donald Trump announced a second round of sanctions against Iranian crude exports this month, aimed at curtailing Iran’s ability to finance its regional ambitions.
The sanctions target oil brokers in the UAE and Hong Kong, in addition to Indian operators of oil tankers, accused of assisting Iran in transporting its oil.
The new sanctions come in a time of increased tensions in the global oil market, with prices already volatile due to a mix of geopolitical tensions and concerns about slower global demand.
Bitcoin sharpens losses to three-month low amid selloff
Bitcoin fell on Tuesday on track for the third loss in a row, plumbing three-month lows after losing trading above the $90,000 barrier amid a heavy selloff.
It comes amid tense tensions in the crypto market due to the lack of positive stimuli in the short term, while US stocks tumbled on Wall Street, led by the tech sector.
Prices
Bitcoin fell 5.7% today at Bitstamp to $86,314, the lowest since November 12, with a session-high at $92,512.
On Monday, bitcoin lost 4.9%, the second loss in a row, and the heftiest since January 7.
Crypto Market Value
The market value of cryptocurrencies fell $210 billion on Tuesday to a total of $2.982 trillion.
Positive Stimuli
Bitcoin started the year with strong momentum, underpinned by US President Trump’s positive stance on the crypto industry, with traders expecting a more supportive and clear regulatory framework for the crypto market.
But the steam has gone out of the market since Trump’s executive crypto order in January, as it was more conservative than expected, especially when it comes to forming a strategic bitcoin reserve.
And with the lack of fresh new stimuli, the market is now waiting for more signals on the future of regulations and institutional demand directions, making prices more volatile in recent weeks.
Wall Street
US stock indices expanded the losses on Monday for the third straight session amid uncertainty about the direction of monetary policies and global trade tensions.
The S&P 500 index fell 0.5%, while NASDAQ tumbled 1.2%, both hitting two-week lows as the tech sector weakened.
As for bitcoin, analysts warned that a return to $70000-$75000 is possible with demand building up strongly as the price heads towards these levels.
Dollar moves in a negative zone as US yields decline
The US dollar fell in European trade on Tuesday against a basket of major rivals, resuming losses near two-month lows as US 10-year treasury yields tumbled.
Recent US services data triggered concerns of a slowdown in the first quarter of the year, which renewed hopes for a Fed rate cut in the first half of 2025.
The Index
The dollar index fell 0.15% to 106.56, with a session-high at 106.79.
On Monday, the index rose 0.1%, moving away from a two-month trough at 106.13.
US Yields
US 10-year treasury yields fell 1.3% on Tuesday, expanding losses for the fifth straight session and plumbing an 11-week low at 4.337%, underpinning non-yielding assets.
It comes after a surprise contraction in the US services sector in February, in a sign that confirmed the slowdown in US economic growth in the first quarter.
US Rates
According to the Fedwatch tool, the odds of a 0.25% Fed interest rate cut in March stood at just 4.5%.
Now investors await crucial US GDP growth and personal spending data this week, in addition to remarks by several Fed officials on the battle with inflation to gather more clues.
Gold gives up record highs on profit-taking
Gold prices lost ground in European trade on Tuesday away from recent record highs scaled on Monday amid profit-taking.
The losses are curbed by a drop in US 10-year treasury yields as investors await more clues on the path ahead for US interest rates in the first half of the year.
Prices
Gold prices fell 0.8% today to $2929 an ounce, with a session-high at $2953.
On Monday, gold rose 0.6%, hitting a record high at $2956 on haven demand.
US Yields
US 10-year treasury yields fell 1.3% on Tuesday, expanding losses for the fifth straight session and plumbing an 11-week low at 4.337%, underpinning non-yielding assets.
It comes after a surprise contraction in the US services sector in February, in a sign that confirmed the slowdown in US economic growth in the first quarter.
US Rates
According to the Fedwatch tool, the odds of a 0.25% Fed interest rate cut in March stood at just 4.5%.
Now investors await crucial US GDP growth and personal spending data this week, in addition to remarks by several Fed officials on the battle with inflation to gather more clues.
SPDR
Gold holdings at the SPDR Gold Trust rose 3.15 tons on Monday to a total of 907.53 tons, the highest since August 2023.