Crude oil's rally eased after rising to as high as 48.83 Monday. While traders are excited by OPEC's meeting on March 30, more disappointing economic data were released during the day. Moreover, oil bulls may need to take a breath after Qatar's oil minister said OPEC requires 100% compliance to previous quotas before more cuts.
In the UK, industrial production contracted 2.6% mom in January after a 1.5% drop in December. At the same time, manufacturing output also plunged 2.9% from December and posted the largest quarterly decline in 40 years as orders for cars and other machinery plunged both domestically and from overseas.
In China, consumer price index slid 1.6% yoy in February, the first decline since 2002, while producer price index dropped 4.5%, the biggest fall in almost 10 years. All of food, energy and metal components got hammered.
Despite the worse-than-expected economic data, stock markets advanced after falling to multiyear low in Asia. The MSCI Asia Pacific Index gained 1% after closing at an 8.5-year low yesterday. HSBC Holdings rebounded 14% after slumping to HK$33/share in Hong Kong and drove the Hang Seng Index 2.3% higher. In European morning, shares opened slightly higher as banking stocks in the UK rebounded. HSBC added 1.9% while Barclays gained 6%.
We do not think global financial markets have been out of wood yet and recoveries today can be viewed as opportunities to sell the shares if you have positions
Gold price extends another leg of correction after recovering to 945.5 last Friday. Currently trading at 912.2, the benchmark contract slid to as low as 908.4 earlier today. Rebounds in stock markets may have driven investors from gold to more risky investment.