US equities staged a strong rebound overnight with the best daily performance since March. DJIA jumped 222.44 pts, or 1.26%, to close at 17928.35. S&P 500 also rose 25.7 pts, or 1.25% to close at 2084.39. More importantly, both indices defended near term support levels well, that is, 17484.23 in DJIA and 2033.8 in S&P 500, and maintained bullishness. Both indices are still on track for at least a test on historical highs. However, risk appetite doesn't follow in Asia. Nikkei opened higher but pared back all the gains quickly. Meanwhile, China's Shanghai SSE (LON:SSE) composite turns negative at the time of writing. In the currency markets, yen surged yesterday on intervention talks but pared some gains. Meanwhile, commodity currencies recover mildly and dollar turned mixed.
WTI crude oil recovered yesterday after dipping to as low as 43.03. It's staying in recent consolidation pattern and is staying bullish for extending recent rise through 46.78 high. Concern over supply disruptions in Nigeria and Libya sent energy prices higher. The Nigerian government announced that it would "crush" rebels, who "have vowed to cripple economic activities", following an attack occurred last week causing production disruption of about 90K bpd. It also indicated that "the military will employ all available means and measures within its rule of engagement to crush any individual or group that engages in the destruction of strategic assets and facilities of the government". Royal Dutch Shell (LON:RDSa) and Chevron (NYSE:CVX) are evacuating workers from the Niger Delta due to security reasons. Meanwhile, Libya's oil production has declined to 0.21M bpd on Monday, as AGOCO, a subsidiary of National Oil Corp (NOC), was forced to cut output by more than 30% from southeastern fields. According to Bloomberg, the disruption was driven by exports dispute which involves the internationally backed NOC in Tripoli and a parallel version of the NOC created by a rival Libyan government in the east of the country.
On the data front, Australia Westpac consumer confidence rose 8.5% in May while home loans dropped -0.9% in March. Japan will release leading index. UK will release industrial and manufacturing production in European session. But main focus will stay on the BoE "Super Thursday" tomorrow and eyes will be on projection adjustments in the quarterly inflation report. US will release crude oil inventories.