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Oil was headed for its longest run of daily gains since February 2019 on Thursday, after a drop in U.S. crude stockpiles added to signs that the market is starting to balance. West Texas Intermediate (WTI) futures rose for a sixth consecutive day in New York towards US$34 a barrel.
Observers note that the oil market is in better shape than it was a month ago, as output cuts have now kicked in and demand has begun a slow recovery. With American inventories falling and traders now more optimistic that storage isn’t at capacity, the so-called cash roll for WTI in June/July traded at 30 cents on Wednesday. Bloomberg data shows that this is the first time the cash roll has trade above zero since December.
The Office for National Statistics this week said that, in April, the number of Britons seeking unemployment benefits saw its largest ever spike – as claims rose by 856,500 to more than 2 million.
This news comes during a period of historically-low inflation, falling to its weakest level since 2016 in April due to the lockdown and the fall in energy prices. The prospect of sustained, low inflation is fuelling market speculation about whether the Bank of England could take further monetary-policy actions. The debate among policymakers about taking the country’s rates below zero for the first time has intensified, too, as a result.
The U.K. has pledged to invest up to $20 million in the African Union’s new COVID-19 Response Fund, designed to tackle coronavirus across the continent. The fund – launched by Chairperson of the African Union and President of South Africa Cyril Ramaphosa – aims to tackle the pandemic by recruiting African health experts, preventing the spread of potentially harmful misinformation and providing specialist coronavirus training for health workers.
The U.S. is also showing its commitment to COVID relief for Africa through the Health and Prosperity Initiative. Spearheaded by the U.S. International Development Finance Corporation, the initiative aims to invest up to US$2 billion through a range of financial tools including equity and debt financing, political risk insurance and technical development.
Stocks declined alongside U.S. equity futures on Thursday, reversing some gains made earlier in the week as deteriorating Chinese-American ties raised concerns across markets. Contracts on the three main American equities gauges signalled a drop at the Wall Street open, a day after the U.S. Senate overwhelmingly passed a bill barring some Chinese companies from listing on American exchanges.
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