Analytics, News, and Forecasts for CFD Markets: raw news — 17-06-2020.

• Producers' compliance with OPEC+ oil output-cut deal currently stands at 89%
• Russia's compliance with OPEC+ deal is almost 100%
• Russia plans to fulfill the deal in full
• Optimistic on global oil demand recovery
• We need to monitor how the situation is changing in the oil market

FXStreet reports that Georgette Boele, Senior FX and precious metals strategist at ABN Amro, expects a lower silver price in the near-term due to a risk-off environment and a downshift in expectations in demand for silver. On the longer-term, however, when the global economy recovers again, it is likely that silver prices will outperform gold prices again.

“There are two situations when it is more attractive to invest in silver compared to gold. First, industrial demand is larger for silver than for gold. If global growth recovers, there is more industrial demand for silver, and this supports the silver price. It is likely that in this environment silver prices outperform gold prices. Currently investors expect that the economy will recover considerably as lockdown measures are eased. Therefore, silver prices have outperformed gold prices. Second, silver prices are at relatively attractive levels compared to gold prices. In March, gold was 127 times more expensive than silver. At the start of June gold was 95 times more expensive than silver. The long-term average of the gold/silver ratio is around 60. So, there is more room for silver prices to outperform gold prices but this will take time.”

“In the near-term, we think that there are several factors that could spoil the party for silver prices. For a start, investors do not seem to be pricing in the scale of the earnings and macro weakness we are seeing and the likelihood of a slow rather than V-shaped recovery. A downward adjustment in demand expectations for silver will weigh on silver prices. Moreover, we expect another risk off wave between now and three months. It is likely that investors will close part of their positions. Speculators are net-long on the futures market. The positions that investors hold at exchange traded funds are at a new record high. Another factor that can dampen demand for silver are the tensions between the US and China.”

Reuters reports that a whopping 98% of investors surveyed by Bank of America believe markets are "overvalued" after world stocks bounced back from March lows at a record pace driven by government stimulus measures.

World stocks surged 38% from March's multi-year lows, fuelled by trillions of dollars in stimulus and gradual lifting of coronavirus lockdowns.

The euphoria led to investor cash levels dropping to 4.7% in June from 5.7% last month, the biggest monthly drop since August 2009, BofA's survey of 212 fund managers with $598 billion (£473 billion) in assets under management showed.

The drawdown was also partly supported by easing worries about a longer economic hit -- a net 46% of participants in the survey expected a prolonged recession versus 93% in April.

BofA, however, said the recent optimism in markets was "fragile" as investors still see a second wave of novel coronavirus infections as the "biggest tail risk".

Indeed, stocks and oil briefly came under pressure on Monday after several districts of Beijing closed schools and ordered people to be tested after an unexpected rise in infections.

But those fears haven't stopped investors from joining the rally. The survey showed hedge fund net equity exposure jumping to 52% from 34%, the highest since September 2018.

A recent rally in value stocks, firms whose fundamental worth is not reflected in their share price, was driven by investors "violently" covering tactical short positions, BofA said.

U.S. tech and growth stocks remained the "most crowded trade" for a second straight month.