Top Things to Know in the Market on Tuesday, May 12th

• 2020-05-12
• Traiding Idea

Saudi Arabia to cut oil output by another 1 million barrels a day

After Saudi Arabia ordered its state oil giant to cut production by 1 million barrels a day, in addition to reducing production agreed by OPEC+, Crude prices reversed early trading losses and finally rose again.

Oil prices rose after Saudi Arabia, which has been hit hard by low prices, said it would cut production in June more than ever before.

The voluntary cut, announced by the Saudi Ministry of energy, will wipe out an extra 1 million barrels a day from world markets.

Thus, the total decrease in Saudi oil production will be 4.8 million barrels per day compared to April's production level.

Riyadh hopes the decision will encourage other OPEC members to adhere to their agreed production cuts.

The U.S. West Texas Intermediate ( WTI ) futures surged 0.24%, to settle at $24.38 per barrel. Brent crude futures jumped 0.11% to $29.74 per barrel.

Tesla CEO Elon Musk says ready for arrest as he reopens California plant against local order

Contrary to orders to stay closed, Tesla CEO Elon Musk has resumed production at the company's only factory in the United States, California and saying if anyone had to be arrested, it should be him.

The move comes as cities and states in the United States are experiencing safe ways to reopen their economies after the coronavirus outbreak shuttered businesses and laid off millions of Americans.

Earlier this week, Tesla's CEO threatened to move his plant from California to Texas or Nevada due to forced closures.

Musk tweeted that production would resume on Monday, adding that he would also join the workers on the assembly line. "If anyone is arrested, I ask that it only be me," he wrote.

Health officials in Alameda County, where Tesla's Fremont factory is located, said Monday they were aware that Tesla had opened beyond minimum basic operations and had informed the company that It cannot operate without a county-approved plan.

The county's lockdown order says that violations will be punishable by imprisonment or a fine, or both.

Stock markets

On Tuesday, Stocks in Asia-Pacific markets fell as China's inflation data for April did not reach the expected level.

National Bureau of Statistics said inflation was 3.3 % in April, while economists polled by Reuters expected it to reach 3.7 %.

China's producer price index, which was projected to fall 2.6 % this month, fell 3.1 %.

In Asia, Japan's benchmark Nikkei 225 lost 0.12% and closed at 20,366.48. The Hang Seng in Hong Kong dropped 1.62% to 24,196.02.

China's Shanghai Composite slipped 0.14% and ended at 3,953.24. In Australia, the S&P/ASX 200 index fell 1.07% to 5,403.

Among other major Asian indices, TOPIX (Tokyo Stock Price Index) was down.

In the U.S. stock market, The Dow Jones Industrial Average plunged 0.45 % to 24,221.99. The S&p 500 declined 0.02 %, to 2,930.32 while The Nasdaq composite advanced 0.78%, to 9,192.34.