Oil price rally pushes stocks up around the world as US indices hit multiple record highs

Jasper Jolly
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Investors are betting on Opec to turn off the taps at its meeting later this month (Source: Getty)

The continuing rally in oil prices led stocks around the world higher as a succession US indices hit all-time record highs at the close.

Oil prices are rising on expectations that oil production cartel Opec will cut production at the end of the month. It meets on 30 November.

The US oil benchmark, West Texas Intermediate, continued its rally since the end of last week towards $49 per barrel. The North Sea benchmark, Brent crude also extended its rally, breaking through the $49.50 per barrel mark.

The Nasdaq Composite and Russell 200 were first to break through their intraday peaks, followed by the S&P 500 and the Dow Jones Industrial Average.

Read more: Peak oil is back – and the IEA reckons it's coming soon

Meanwhile, Germany’s Dax index was up 0.77 per cent for the day, France’s Cac 40 was up 1.34 per cent, and the UK’s FTSE 100 closed up 0.82 per cent, before continuing to extend gains this morning. The Dax and the Cac both also continued the upward move in morning trading.

Japan's Nikkei 225 was up 0.3 per cent, despite a 7.4 magnitude earthquake off the coast prompting mass evacuations on tsunami warnings. No major damage has been reported so far.

The markets all shrugged off news that US President-elect Donald Trump will abandon the Trans-Pacific Partnership trade deal. The move was widely expected after forming a major part of Trump’s campaign trail broadsides against trade deals globally.

While the stance on trade has not affected the post-election stock surge, it could have longer-term implications.

The TPP-disintegration will change the trade dynamics across the Pacific, as the treaty’s main engine, will aim to build bilateral trade deals with its Pacific partners, which could benefit to some countries, and hurt the others," said Ipek Ozkardeskaya, senior market analyst at London Capital Group.

Trump’s election has also provided energy stocks with a political boost. He had repeatedly promised to lower regulation on the US energy sector, and was scathing about environmental regulation, calling global warming a hoax perpetrated by China.

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