London’s FTSE 100 is expected to pull back at the start of Thursday’s trading, setting the benchmark to break a five day streak of gains.
It comes after weaker oil prices – Brent fell 2.5% to US$43.85 (£33.80) and WTU dropped 3% to US$41.50 (£32.00) – and thus energy stocks weighed on US equities.
The narrative in the oil market sounds a lot like a broken record, with rising inventories and a will-they-won’t-they talk over an OPEC freeze.
Michael Hewson, analyst at CMC Markets, said, “US markets finished on the back foot yesterday after oil prices slid sharply after a surprise build in inventories saw the recent rebound go into reverse gear”.
“With the latest OPEC data showing that Saudi Arabia posted record output in July it became clear that for all the chatter about a production freeze, and predictions of higher demand that any agreement would have to overcome significant hurdles from the main swing producers, which at this moment appears unlikely.”