Global Markets Steady, OPEC Gearing Up for More Cuts

BEIJING, China – Global markets have inched marginally higher at the end of the trading week on the increasing optimism over US-China trade talks, while the OPEC is gearing up towards imposing deeper cuts.

Most of the Asian markets ended on Friday cautiously higher as market players grow increasingly hopeful that the trade war between the US and China that has been going on for over a year is going to reach a partial agreement soon. It came after a more upbeat statement from the US President Donald Trump on Thursday, offering hopes to investors that both countries are nearing an agreement for phase one of the trade deal.

Previously in the week, the market was up and down with the mixed signals from the US President regarding trade talks with China. Nevertheless, the market is eating up any development on US-China trade negotiations ahead of the new tariff hike Washington is going to impose on Chinese goods on December 15, valuing around $160 billion.

On the other hand, OPEC (Organization of Petroleum Exporting Countries) has agreed to deeper cuts. After OPEC announced its decision, oil prices have spiked on Thursday, reaching towards over $59.05, unseen level in the market for more than two months.

OPEC and all its allies have reached an agreement in principle that by the first quarter next year, they are going to impose an output cut by around 500,000 barrels per day. However, the gains weren’t steady as the price retracted a while later, following OPEC’s failure to offer more clarity regarding the agreement to offer deeper production cuts.

Aside from any update on trade talks, market players are also keeping their eyes focused on the press conference scheduled on today, which is expected to offer more key details about the OPEC’s agreement and the process of distribution of the supposed production cuts among members.

On the other hand, Saudi Aramco’s IPO was yesterday, and it was seen as the biggest IPO ever. The shares for Saudi Aramco has surpassed the $25 billion of the previous biggest IPO, online trading group Alibaba in China in 2014, gaining around $25.6 billion. The massive IPO has given the Aramco a mammoth market valuation at $1.7 trillion, which has also taken the most precious publicly-traded company crown, which was held by the $1.17 trillion of Apple.

In Commodity, the gold has advanced more than 1% since early in the trading week, thanks to the weakness of the dollar and the mixed signals on the US-China trade talks.