Energy Sector to Fend Off Bond-Yield Dominance after a Surge in Oil Prices to $67
Energy Sector to Fend Off Bond-Yield Dominance after a Surge in Oil Prices to $67.
Energy stocks are expected to keep the negativity in the Thai stock market at bay in concerns of surging U.S. 10-year bond yield to its 1-year high at 1.57% after Fed’s Chairman Jerome Powell’s to not push back against a jump in bond yields.
Oil prices edged higher to $67 a barrel, following the Organization of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+)’s agreement to extend most oil output cuts into April.
Last night, the West Texas Intermediate (WTI) for April delivery added 2.55 U.S. dollars to settle at 63.83 dollars a barrel on the New York Mercantile Exchange. Brent crude for May delivery increased 2.67 dollars to close at 66.74 dollars a barrel on the London ICE Futures Exchange.
Brent extended its gain in the Asian morning session to 66.91 dollars a barrel, while WTI rose to 64.04 dollars a barrel.
Despite the surge in oil prices, stock markets are facing a negative session as U.S. Treasury yields pushed higher to nearly 1.6%.
The energy sector conquers 20% of the total market cap in the Thai stock market, thus, the positive sentiment over surging oil prices could provide some resistance to the bond-yield dominance.
Finansia Syrus (FSS) expected SET to edge lower to 1,515-1,520 points from the Fed’s comment regarding the bond yield, which resulted in further gains for the U.S notes.
FSS stated that SET Index could face a profit-taking session after a high surge recently and high P/E, while having a positive outlook on cyclical and commodity stocks, especially the energy stock.