Oil down 4 consecutive sessions since Trump’s inauguration. Natural gas prices rise again due to cold weather

The Dow Jones Index (US30) was up 0.30% at Wednesday’s close. The S&P 500 Index (US500) was up 0.61%. The Nasdaq Technology Index (US100) added 1.33%. US stocks closed solidly higher yesterday, helped by strong earnings and promising corporate developments while markets assessed the implications of President Trump’s policy changes. Netflix rose by 9.7% after reporting a record increase in new subscribers. Additionally, Procter & Gamble shares added 1.9% on strong quarterly results. Oracle increased by 6.7%, delivering a nearly 20% weekly gain after announcing a joint venture with SoftBank and OpenAI related to a $500 billion artificial intelligence investment initiative. Nvidia rose by 4.4% and Microsoft added 4.1%, joining the broader technology rally.

Equity markets in Europe were mostly up on Wednesday. Germany’s DAX (DE40) rose by 1.01%, France’s CAC 40 (FR40) closed higher by 0.86%, Spain’s IBEX 35 (ES35) fell by 0.37%, and the UK’s FTSE 100 (UK100) closed negative 0.04%. On Wednesday, the DAX Index closed above a new record high of 21,259, posting its eighth consecutive session of gains and outperforming its European peers. The index was boosted by strong earnings from Adidas and optimism about large-scale investments in artificial intelligence. In Davos, ECB President Christine Lagarde warned Europe to anticipate possible changes in US trade policy, including selective tariffs under President Trump. She advocated economic reforms, supported the ECB’s cautious approach to lowering interest rates and cited energy prices as the main inflationary problem.

WTI crude prices fell to as low as $75 a barrel on Thursday, retreating for a fifth straight session after an industry report showed a new rise in US crude inventories. API data showed a 1 million barrel increase in crude inventories last week, the first rise after five weeks of declines. Traders also continued to assess the potential impact on energy markets of President Trump’s proposed tariffs on China, the European Union, Canada and Mexico, as well as warnings of sanctions on Russia if President Putin does not work to end the war in Ukraine.

The US natural gas (XNG/USD) prices rose to $3.9/MMBtu as cold temperatures led to record demand. On January  21, the coldest day in five years, heating demand surged, pushing spot gas and electricity prices to multi-year highs. Analysts expect energy companies to draw more than 200 billion cubic feet of gas from storage for two consecutive weeks, reversing a small inventory surplus compared with the five-year average.

South African inflation rose slightly to 3% in December 2024, up from 2.9% in November, but below the 3.2% projection. This rate remains well below the Reserve Bank of South Africa’s preferred average target of 4.5%. Core inflation, which excludes volatile categories such as food, soft drinks, fuel and energy, fell to 3.6% in December 2024, the lowest since February 2022, down from 3.7% in November.

Asian markets traded without a single dynamic yesterday. Japan’s Nikkei 225 (JP225) added 1.58%, China’s FTSE China A50 (CHA50) was down 1.48%, Hong Kong’s Hang Seng (HK50) was down 1.63%, and Australia’s ASX 200 (AU200) was positive 0.33%.

Singapore’s annualized inflation rate for December 2024 was 1.6%, unchanged from the previous month and above market expectations of 1.5%. Meanwhile, the annual core inflation rate fell to 1.8%, the lowest in three years, down from a 1.9% rise in November but above market estimates of a 1.7% rise.