The crude oil fell 1.58% to $70.83 a barrel after Donald Trump in his victory speech said, “…leave the oil to me.” The US has more liquid gold, oil and gas, than any country in the world.
The US has more liquid gold than any country in the world, said Trump. More than Saudi Arabia, and Russia. “Bobby (Robert F. Kennedy Jr.), stay away from the liquid gold. Other than that, go have a good time, Bobby,” said Trump. “We’re going to be paying down debt. We’re going to be reducing taxes. We have, we can do things that nobody else can do. China doesn’t have what we have.”
Natural gas and oil markets are experiencing downward pressure as escalating geopolitical tensions and a strengthening U.S. dollar weigh on demand. The US crude inventories have also expanded more than anticipated, signalling softer demand conditions, said Shrikant Chouhan, Head of Equity Research at Kotak Securities.
Trump’s victory effect has spilt over to currencies all over the world as well. The dollar index has strengthened, pressuring countries around the globe. The dollar index rose more than 1%, leading to softness in gold prices. The rally in the dollar index has led to the rupee slipping to an all-time low of 84.25 against the dollar.
“The market reaction reflects concerns about potential sanctions and protectionist policies, given Trump’s history of prioritizing measures to strengthen the US economy. As a result, the rupee’s weakness may extend further, with the next potential downside targets at 84.50-84.70, while resistance is likely to be seen near the 83.90 level,” said Jateen Trivedi, Vice President and Research Analyst of Commodity and Currency at LKP Securities.
Markets recap
The domestic key benchmark indices extended gains for the second day. The Nifty 50 closed 270 points or 1.12% higher at 24,484 while the BSE Sensex ended the session 901 points or 1.13% higher at 80,378.
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