Day Ahead: Top 3 Things to Watch for April 7

By Kim Khan

Investing.com - Wall Street started the week off on a strong note, with a huge jump in the major indexes.

The market rallied on signs that infections in New York and elsewhere are leveling off, although it is still way too early to say anything definitive.

Market moves in the U.K. will be closely watched tomorrow after Prime Minister Boris Johnson’s condition worsened. And investors will be anxious for any more reports on another round of stimulus funding from the U.S. federal government.

And oil prices should see more volatility as quotes from energy producers trickle out ahead of an OPEC+ meeting later in the week.

Here are three things that could move the markets tomorrow.

1. Pound Will Be Active With Prime Minister in ICU

Sterling will in focus tomorrow as more details of the prime minister’s condition are released.

Johnson was moved to the intensive care unit late Monday and Foreign Secretary Dominic Raab has been asked by the prime minister to deputize “when necessary”.

The pound had been rising through most of the trading day, bouncing back from oversold levels despite disappointing economic data. But it quickly moved into the red against the U.S. dollar when the report of Johnson moving to intensive care came out.

GBP/USD was flat in late trading.

2. Phase 4 Stimulus by May?

While U.S. stocks were already sharply higher going into the last hour of trading, the bulls got an extra boost right before the close from a report that another stimulus package could come from Capitol Hill.

Another round could come by May and be around $1.5 trillion, Fox Business reported, citing sources briefed by the White House and Congressional leaders.

Any more details from either the administration or legislation could keep the optimism on Wall Street going.

3. API Inventories on Tap as OPEC+ Eyed

Oil prices are laser-focused on the possibility of a global cut in crude production. OPEC+, which includes Russia, is set for a virtual meeting on Thursday that many expect to end with an agreement

The market has been expecting some kind of deal after President Donald Trump tweeted last week that Saudi Arabia and Russia had agreed to cut up to as much as 15 million barrels per day in output. But, as usual, things were not so cut and dry as they sounded in the tweet.

OPEC+ is likely to agree to cut production Thursday as long as the United States joins in cutting output, Reuters reported late Monday, citing three OPEC+ sources.

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Between now and Thursday the usual U.S. data will arrive.

The American Petroleum Institute will issue its measure of weekly U.S. oil stockpiles after the bell Tuesday.

Last week the snapshot showed a huge build of more than 10 million barrels.