Stocks Retreat As Virus Worries Hit MarketsMeanwhile, WTI oil is trying to settle below the $69 level.
Stocks Set To Open Lower
S&P 500 futures are down by about 1% in premarket trading amid fears about the spread of the Delta variant of coronavirus.
Markets are under pressure around the world, and it looks that traders have finally began to price in the risks of slower economic growth due to the spread of the virus.
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Not surprisingly, cruise line stocks and airline stocks are under pressure in premarket trading amid worries that virus fears would put pressure on demand for travel.
Meanwhile, traders buy safe-haven assets like U.S. dollar and Treasuries. The yield of 10-year Treasuries is currently trying to settle below the 1.23% level. At the beginning of July, the yield of 10-year Treasuries was close to 1.50%.
WTI Oil Declined Below The $70 Level
WTI oil managed to settle below the psychologically important $70 level and is currently trying to settle below the $69 level.
Over the weekend, OPEC+ managed to reach a consensus deal. The group will increase its production by 400,000 barrels per day (bpd) each month until the end of 2022.
This is a positive development for the oil market as it indicates that OPEC+ remains a viable organization which can reach consensus despite internal disputes.
In the short term, the market may be worried that OPEC+ will start to increase production at a time when demand may take a hit from another wave of coronavirus.
However, recent data indicated that demand for oil continued to increase, and it remains to be seen whether new problems on the coronavirus front will have a material impact on the oil market.
Precious Metals Are Under Pressure At The Start Of The Week
The U.S. Dollar Index, which measures the strength of the U.S. dollar against a broad basket of currencies, has recently managed to get above the resistance at 92.80 and is currently trying to settle above the 93 level.
Gold mining stocks and silver mining stocks were declining on Friday, and it looks that the sector is ready to test multi-week lows during today’s trading session.
For a look at all of today’s economic events, check out our economic calendar.