May 28, 2023


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Significant decline in the Oslo Stock Exchange

Significant decline in the Oslo Stock Exchange

The main index on the Oslo Stock Exchange rose from the start on Tuesday, but the mood soured throughout the day, and the main index closed 1.29 percent lower and closed at 1,198.82 points.

– This week, the market can get some rest. There is often a correction after such a tough week, so it might be a little easier now, says chief strategist Anders Johansen at Danske Bank.

On Monday, the main index rose a solid 1.56 percent. It was a long-awaited recovery after the worldwide stock market plunge. The price of oil also fell by about six percent at the end of last week.

On Tuesday, the price of oil rose again and a barrel of North Sea oil was trading at just over $115 a barrel on Tuesday afternoon.

Havila Shipping wins in the stock market after the shipping company wins a lawsuit in Hordaland County Court on Monday to Take over the sanctioned ship “Havela Capella”The share rose by 13.7%.

– The Oslo Stock Exchange is mainly affected by the events in the global financial market, and secondly, it is oil prices that drive development, as Johansen points out.

Inflation or stagnation

Johansen believes that the market should strengthen itself so that there will be a lot of turmoil in the stock market in the future.

It is likely to fluctuate well both up and down across all global stock markets until inflation numbers show signs of normalization, he says.

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Sky-high inflation and rising interest rates are the main cause of the great turmoil in the stock market lately. Last week, the US Federal Reserve raised interest rates by 0.75 percentage points, its highest rise since 1994.

The challenge for central banks is to balance between too much or too little. Too little can lead to runaway inflation and a loss of credibility. Too much can lead to a recession and a significant drop in the value of financial markets, Johansen says, which in turn weakens the economy.

Concerns about aggressive monetary policy tightening are leaving the market very uncertain.

Uncertainty about upcoming interest rate hikes by the Federal Reserve will be an ongoing pressure factor for the market. This also affects the development of the Oslo Stock Exchange, and to a much greater extent the austerity measures from Norges Bank, says Johansen.

On Thursday, the Norges Bank will present a new rate decision. The big question is not whether the key rate will be raised, but by how much.

– The interest rate meeting is “almost non-existent” for the Oslo Stock Exchange, but this time there is more uncertainty and tension about what Norges is down with, says Johansen, who believes the key policy rate will rise by 0.25% points.

get up waiting

US stock exchanges are closed on public holidays on Monday. On Tuesday afternoon, all US stock indexes rose sharply.

Last week ended with a broad decline on Wall Street. Then renewed fear of recession led to market turmoil. A recession means two consecutive quarters with a decline in economic growth.

Three of the world’s most important stock indices, along with most others in the world, are in a deep correction. The S&P 500 fell 22.9 percent in 2022, while the Dow Jones fell 17.7 percent in the same period. The Nasdaq was even lower, dropping as much as 31 percent in the first half.

All of the leading European stock markets rose slightly on Tuesday.(Conditions)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using a link that leads directly to our pages. All or part of the Content may not be copied or otherwise used with written permission or as permitted by law. For additional terms look here.

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