Shanghai Shutdown Dents The Oil Price, While Investors Take A Wait And See Approach Over Ukraine
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”China’s zero tolerance covid strategy is causing fresh nervousness about supply chain issues and a slowdown for some sectors with the Shanghai shutdown prompting a fall in the oil price. A barrel of Brent crude dipped by around 3% after tough restrictions were put on the financial and manufacturing hub. 25 million people are facing lockdown in two stages, while mass testing is carried out, with factories ordered to shut down and working from home orders imposed.
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FTSE 100 Shrugs Off Shanghai Shutdown
The FTSE 100 has largely shrugged off the concerns about the effect on global trade for now, with the FTSE 100 opening up marginally in early trade with mining stocks Rio Tinto plc (LON:RIO) and Anglo American plc (LON:AAL) along the risers, but energy giants BP plc (LON:BP) and Shell PLC (LON:SHEL) slipping back as oil retreated.
NatWest Group has reached a milestone with the UK government’s stake in the bank peeled back to below 50% since the first time since the financial crisis. It’s been a long road back from emergency purchase of the beleaguered Royal Bank of Scotland group, with a re-brand, and the step by step repurchase of the government holdings. This is the fifth sale, returning £1.2 billion to treasury coffers, at a time when the government sorely needs the cash with the costs of borrowing mounting.
Geopolitical tensions are still high in investors’ minds with negotiations set to re-start in Turkey to try and find a way to break through the impasse in the attempts to broker a ceasefire. But it’s largely a wait and see approach traders are taking right now, with hopes lifting slightly with President Zelensky reported to be ready to discuss neutral status. However, a fresh cloud has been put over these talks after President Biden’s off-the-cuff remarks about President Putin, despite the backtracking by the US administration, which has underlined that regime change in Moscow is not on the cards.''
Article by Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown
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