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Dec 19, 2016

Bloomberg Markets - December 19, 2016: You Need to Know to Start Your Day

by Lorcan Roche Kelly

Get caught up on what's moving markets.

Optimism breaks out in the oil market, Scotland says access to the single market is more important than a united kingdom, and trading is quiet ahead of the holidays. Here are some of the things people in markets are talking about today.

Oil's future looks bright

Bets on rising oil prices have surged to their highest levels since July 2014 as investors give the supply-cut deal between OPEC members and non-OPEC countries the thumbs up. In trading this morning, the price of a barrel of West Texas Intermediate for January delivery rose to $52.18 by 5:00 a.m. ET. Over the weekend, BP Plc announced it has gained a stake in an Abu Dhabi oil concession that will provide 160,000 barrels a day, which the company is paying for with $2.2 billion of its own shares.


Scottish First Minister Nicola Sturgeon said that the country will hold a new referendum on its place in the U.K. should Britain lose access to the single market at the conclusion of Brexit negotiations. In a weekend interview, International Trade Secretary Liam Fox said the U.K. could try to stay in the customs union in a deal similar to Turkey's arrangement with the EU. Uncertainty over the future is starting to weigh on employer decisions in Britain as they seek to increase employees now to 'lock in' talent they may have difficulty attracting port-Brexit.

Barclays cuts customers

Barclays Plc is looking to
cut 7,000 clients
 who aren't trading with the bank enough to provide high returns. As new capital rules make dealing with many smaller firms less cost-effective, investment banks are concentrating their efforts on the large clients that generate the best profits. Citigroup Inc., Morgan Stanley, HSBC Holdings Plc and Deutsche Bank AG have all changed how they deal with smaller clients. 

Markets quiet

Overnight, the MSCI Asia Pacific index advanced 0.1 percent while Japan's Topix index slipped 0.1 percent ahead of tomorrow's Bank of Japan monetary decision. In Europe, the Stoxx 600 Index was 0.2 percent lower at 5:24 a.m. ET in thin trading ahead of the Christmas break. S&P 500 futures added 0.2 percent.

Sub tweet

China rejected President-elect Donald Trump's comment on Twitter that the country had "stolen" a submersible drone, saying the country removed it to protect shipping in the South China Sea. Trump's anti-China rhetoric has rattled relations between the two nations, with leaders in Beijing biding their time ahead of Trump's presidential term that begins on Jan. 20.

What we've been reading 

This is what's caught our eye over the weekend.