Crude oil’s fall dominated markets today as investors continue to fear a deal will not be reached at tomorrow’s all-important OPEC meeting. Members hope that global production can be cut to somewhere between 32.5 and 33 million barrels a day from 33.8 million in October. Prices fell as much as 4 percent on Tuesday, wiping out all of Monday’s gains.(See also: Oil Struggles on OPEC Doubts.)
Iran and Iraq continue to push back on demands from Saudi Arabia to cut or freeze production, in part to them being less dependent on oil than Saudi Arabia. Crude oil traded below $45 a barrel in the morning before settling back above $45. At 3 p.m. EST crude was down 3.6 percent on the day.
Elsewhere, the second estimate of U.S. third-quarter GDP beat expectations showing the economy expanded at 3.2 percent in the quarter, the fastest pace in two years. The good news saw U.S. treasury yields trade higher: the 10-year yield hit 2.34 percent and the price sensitive 2-year yield traded to 1.12 percent, 5 basis points from its six-year high. The U.S. dollar index was unchanged for the most part of the day with mixed results against its major trading partners. At 3 p.m. EST the U.S. dollar was higher against the Japanese yen but lower against the euro and the British pound.
It was a relatively quiet session for equity markets with most major indices showing modest gains in the afternoon after opening in the red. At 3 p.m. EST the Nasdaq was the best performing index, up 0.6 percent.
In addition to tomorrow’s OPEC meeting, the U.S. ADP employment report will be closely watched as a precursor to Friday’s non farm payrolls report. Expectations are for 160,000 private jobs to have been added in November.