Morning Update – 18/04/16 – by Arjun Lakhanpal

Morning all.. Wall St closed almost unchanged Friday as we waited for the Doha talks on an oil freeze but unfortunately an agreement was nowhere to be seen and Asian stocks fell with oil.. The Nikkei closed down 3.3% with China down 1.3%.. USDJPY was lower and oil related currencies like CAD and NOK lower. Following extended talks, OPEC members and major producers walked away without any agreement on a production freeze. Prior to this, the WSJ had suggested that a draft accord had been circulated calling for a freeze at January levels until the end of October. Saudi Arabia seems to have taken a harder stance however with the major sticking point the lack of participation from Iran, who failed to even send a representative to the meeting. The immediate reaction when markets opened this morning was for WTI to plunge over 7% and touch a low of $37.61/bbl (after closing at $40.36/bbl on Friday). However prices have recovered some of the early losses with WTI down 2% now.. Meanwhile, the news of the lack of an agreement at yesterday’s meeting is interestingly also coinciding with the news of a forced production cut from Kuwait following a public sector strike which started on Sunday. Moving on it’ll be worth keeping a final eye on the Fedspeak tonight (particularly Dudley given his views have been closely aligned with Yellen) with the blackout period kicking in thereafter ahead of the April 26th and 27th FOMC meeting. In the EU Reuters Sources said: ECB is not considering action to weaken the Euro; not happy with USDs recent weakness but sees it as a consequence of Fed policy designed to help the US economy; FX channel not working like it used to; want to avoid impression that ECB is targeting the FX rate; Euro is still in an acceptable range & oil is now helping too.. There is no data of note this morning.. Good luck..