Wall Street opened higher during Tuesday’s trading hours, while oil prices remained volatile.
According to Beijing officials, China will no longer impose restrictions or quarantine travelers. The announcement is set to be activated by January 8, 2023. As for its COVID restrictions policy, the country will keep up with its activated plan, and inverter manufacturers fear the possibility of a sharp decline in the global supply chain.
Despite the pressures and the increased recession possibility, the U.S. futures opened higher on Tuesday during the opening trading hours.
The Dow index opened higher and posted an increase of 0.33%, while the S&P benchmark jumped by 0.59%. As for the tech stocks, three of the top five most appealing stocks failed today, including Apple, Netflix, and Tesla. The Nasdaq index rose noticeably by 0.19 percent.
Reuters’ resources say that Tesla shares are down by more than 2% on Tuesday’s pre-market. The U.S. electric manufacturer fails again after a report says that the company will extend its break in production from January 20 to January 31. 2021 was a massive year for Tesla and the EV market, yet with the increasing pressures of competition and material costs, 2022 was a down year.
In the last 12 months, Tesla lost 65% of its market share value, and expectations say that 2023 will be much harder on the industry as well.
Meanwhile, oil prices continue to rise despite the market’s ongoing volatility. Oil prices rose in the early hours of Tuesday trading, while natural gas prices rose by an average of 3% in most states.
Crude oil West Texas Intermediate rose by 0,56% to a market price of $80 per dollar, whereas Brent oil is now worth $85 per barrel. As a result of the cold and snowstorm that hit most of the United States, natural gas prices have risen to $5.50 per gallon on average. Due to the recent Russian announcement, the holidays and the energy and heat crisis are increasing in the U.S. and the Eurozone.
By the start of the new year, the world will have to deal with the oil production shortage that will result in reducing the Russian oil position, which is estimated to be reduced by 5–7%. On a daily volume basis, Russia will reduce its oil production by up to 500.000 barrels per day.
Gold continues its momentum in the final days of this year, jumping from $1800 to $1815 per ounce. The dollar index will lose momentum, as experts predicted; today, the dollar has lost 0.3% against its peer, the Euro.
For the current time, the market faces two extreme problems that could risk a market rally. higher inflation rates and higher interest hikes. The second-largest challenge comes from China’s restrictive policies and their effects on the global supply chain.
Furthermore, experts see the possibility of a 4.5% interest rate hike by the first FED meeting in February 2023. However, in terms of market expectations, the current data poses a significant risk to a market rally and future stock performance, particularly in an oil-stricken market.