Trump forgets that the oil price also has an effect on Wall Street

in #investments6 years ago

Trump forgets that the oil price also has an effect on Wall Street







Donald Trump managed to ensure a falling oil price last Monday. For example, the US president announced via Twitter that OPEC should take it easy to reduce oil production. According to the president, a rising oil price is a threat to the growth of the world economy. Trump forgets, however, that a rising oil price could mean good news for Wall Street.

 

  • Since the beginning of this year, the oil price has already increased by more than 25%. Incidentally, this increase was also badly needed, because during the last months of 2018 the oil price plummeted. The increase this year is mainly due to the additional measures taken by OPEC to further reduce oil production.



Falling oil price may end rally on the trading floor




 

  • Trump is not exactly charmed by the measures taken by the organization of oil countries. According to the president, the world economy is currently too fragile to withstand a higher oil price. With these words, Trump managed to ensure a falling oil price last Monday.






  • However, Trump must not forget that Wall Street also benefits from rising oil prices. For example, during the past year there was a strong correlation between the Dow Jones index and the oil price. Should the oil price continue to come under pressure, this could also have negative consequences for share prices. And since Trump has linked his fate to the fair, it does not seem to be a favorable scenario.



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After his last tweet I bought a LONG certificate on Oil and gained about 120%.