By Geoffrey Smith and Alessandro Albano
Investing.com – Beijing tells China’s energy sector to keep the lights on “at all costs” as US lawmakers agree on debt but not infrastructure. Contrary to what has been observed in Europe, Wall Street is indicated positively for the first session of October, while the data on the American manufacturing PMI and on the PCE index are expected in the macro agenda. Here are the main market movers on Friday:
1. “At all costs”
The Chinese government has ordered the country’s utility companies to guarantee energy deliveries “at all costs”, giving the green light to possible “clashes” on the global natural gas market given the lack of supplies.
European gas futures hit € 100 per megawatt hour before retracing, but spot contracts are around the equivalent of the oil price of $ 200 a barrel.
Beijing’s action, which comes at a time when more than half of the country’s regions are rationing consumption, eases the pressure on energy-intensive industrial users who have had to cut production in recent weeks. However, without price adjustments, the energy sector will face severe financial losses which may require the state to recapitalize in the future.
2. The Chamber postpones the vote on infrastructures
The US House of Representatives has postponed the vote on the $ 1.2 trillion infrastructure bill proposed by a bipartisan group. Members of the far left wing of Congress have refused to support the plan unless it is juxtaposed with the larger 3.5 trillion welfare and energy transition plan.
However, the specter of a government shutdown was averted after President Joe Biden signed a bill extending federal funding until December 3.
3. Negative bags
October begins the way September ended, filled with fears of monetary tightening, an income squeeze due to rising energy prices and an economic slowdown. News from China, while alleviating the threat of product shortages, has apparently done little to change that.
However, futures point to 131 points up, 13 points up, and 42 points up. In September, the S&P 500 lost 4.8%, the Dow Jones -4.3% and the NASDAQ Composite -5.3%. To follow the manufacturing ISM and the PCE index.
In Europe, the loses 0.2%, the Cac loses 0.15%, the marks -0.7% while Piazza Affari loses only 0.1%.
Oil prices are affected by OPEC’s plan to increase supplies by more than 400,000 barrels per month in November. Currently, the WTI is down 0.8% to $ 74.44 a barrel, while the is down 0.6% to $ 77.88.
Baker Hughes’ weekly oil rig tally data later may show that US shale producers have been able to meet rising global energy demand. The oil rig count hit its highest level since April 2020 last week, one of many indicators that is returning to its normalization after the outsized swings of the past 20 months.