The new week kicked off with a bang as OPEC+ delivered cuts through 2024 and Saudi Arabia pledged to lower production by 1m bpd in July, and maybe longer. WTI crude touched $75 only to fade back to nearly unchanged. It's up $1.82 to $73.55 now and it will be an interesting week for commodities.
What's holding them back is fear of a recession and a sluggish economy in China. Today's China services PMI from Caixin was at 57.1 in an improvement from 56.4 but many are looking for some real stimulus from Beijing.
In the US, the Fed is in the blackout period now and likely to skip hiking at the June meeting. The market is currently pricing a 30% chance of a hike and 70% chance of no change. That's likely to shift at 10 am ET when the ISM services report is released alongside factory orders. The ISM is the more-important release and forecast to improve to 52.2 from 51.9. Eyes will also be on the prices paid component, which was previously at 59.6.
For more, see the economic calendar.
