REUTERS: An agreement by oil producing nations to cut output by a record amount may sustain a recent bounce in stocks, though stay-at-home restrictions and closures tied to the coronavirus pandemic continue to weigh on the global economy.
Some believe the scope of any oil-related rally will be limited by the coronavirus-related shutdowns that have slowed economic activity around the world.If it was a bigger cut"then you would've seen oil prices strengthen to US$30 very quickly and that would be helpful for equity markets but we didn't get that," said Peter Cardillo, chief market economist at Spartan Capital Securities.
Cardillo noted that much would now depend on when governments around the world are able to lift stay-at-home orders aimed at suppressing the coronavirus. Edward Moya, senior market analyst at Oanda in New York, wrote that he would not be surprised if the agreement became a “buy the rumor, sell the news” event, though he believes it could still give some support to oil prices.