Stocks fall worldwide on oil price drop
Stocks fell around the world on Wednesday, impacting majorly the Asian markets, as the price of crude declined on the news that the three-day strike by oil workers in Kuwait ended, suddenly leaving the markets directionless.
As concerns about oversupply of oil in the market returned to the forefront, prices of Brent crude and US crude oil futures slumped.
Reversing Tuesday’s sharp gains, Brent crude fell by $1.12 to $42.91 a barrel, whereas US crude oil was down $1.09 to $39.99.
The concerns over Chinese economy also resurfaced as Shanghai Stock Exchange slid 3.8 percent, with almost all the sectors from telecoms to financials witnessing a slide.
The depressing mood of the market also reflected due to 0.3 percent fall in S&P 500 EMINI futures and gains for US bonds. The futures in European markets showed a loss of 0.4-0.6 percent for the FTSE 100, DAX and CAC 40.
Starting at its highest level, since early November, the MSCI’s broadest index of Asia-Pacific stocks outside Japan came down by 0.7 percent. However, Japan’s Nikkei Index stuck to a 0.2 percent rise due to the recent pullback in the yen.
India’s Sensex and the Nifty were traded nearly stable after reaching their highest level in more than three months in the earlier session. The Sensex (30-share BSE index) was up 0.13 per cent or 34.58 points at 25,850.94 and the Nifty (50-share NSE index) was up 0.02 percent or 1.25 points at 7,915.95.
The FTSEurofirst 300 index, which measures the performance of Europe's 300 largest companies, after closing 1.5 percent higher in the earlier session, fell 0.3 percent in early trading.
The plummeting oil prices also impacted commodity-linked currencies like Australian and Canadian dollars, which fell from their recent high.
The end of the strike by Kuwaiti workers brings back the bearish mood in the market brought on by the talks’ failure on output by major oil producers in Dohama last week. The producers could not able to consensus on limiting the oil production.