Oil rebounds on Trump tweet
After two days of historic selling, oil rebounded Wednesday. A barrel of WTI soared over 20% to nearly $14, though it broke $16 at the opening bell while WCS rocketed 31% to $5. What triggered the rally was Trump tweeting that he has instructed the U.S. Nacy to shoot down any Iranian ship that harasses American ones at sea. The renewed Middle East tensions, but lifted crude oil prices.
Naturally, the energy sector on the TSX jumped 6.52%, closely followed by materials. Battered oil stocks catapulted Wednesday such as Torc Oil & Gas, rising 14% and Surge which lived up to its name with a 17.78% gain. Though the price of gold has been sideways recently, several gold stocks leapt, including Alamos, up 11.46%.
Similarly, American oil names regained some of their losses, such as Haliburton which gushed more than 10%. Investors were also devour fast food companies like Chipotle Mexican, which served up a 12.15% increase. However, the oil glut remains. OPEC’s historic 10% cut won’t start until May, and lockdowns still paralyze oil consumption (driving), though there’s rising talk of re-opening Europe and the U.S. and the COVID-19 pandemic is finally slowing.