LONDON, May 5 (Reuters) – Oil prices fell on Monday after oil-producing group OPEC+ agreed to accelerate oil production increases, while Taiwan’s dollar surged to almost three-year highs at the start of a central bank-packed week for world markets.
World stocks most flat-lined, with European shares holding just below Friday’s one-month peaks (.STOXX)
, opens new tab while U.S. equity futures dipped , . Overall trading was subdued by public holidays in Japan, China and Britain.
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Brent crude and U.S. West Texas crude futures fell more than 1% , after a weekend decision by OPEC to further speed up oil output hikes fanned concern about more supply coming into a market clouded by an uncertain demand outlook.
Meetings of the U.S. Federal Reserve and Bank of England, among others in big and developing markets, this week were in focus as markets wait to see how major central banks assess the outlook for growth and inflation following heightened uncertainty unleashed by U.S. tariff policy.
President Donald Trump said on Sunday the United States was meeting with many countries, including China, on trade deals, and his main priority with China was to secure a fair deal.
Optimism around a potential de-escalation of trade tensions between the U.S. and China has boosted markets in recent days, with European shares trading just below levels seen before Trump’s April 2 major tariff announcement roiled markets.
“Given the strength of the recovery there is downside risk to markets if positive expectations on trade agreements are not realised,” said Nordea’s chief market strategist Jan von Gerich.
Europe’s broad STOXX 600 index is up 15% from lows hit last month, while the S&P 500 stock index (.SPX)
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U.S. movie and television production companies that film overseas fell in premarket trading after Trump on Sunday announced a 100% tariff on movies produced outside the U.S. but offered little clarity on how the levies would be implemented.
Netflix (NFLX.O)
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, opens new tab and Warner Bros. Discovery (WBD.O)
, opens new tab fell 1.5% and 2.7%, respectively.
Class B shares of Warren Buffett’s Berkshire Hathaway also fell after the investor said at the weekend he will step down as CEO of the conglomerate.
The Taiwan dollar rallied almost 3% against the greenback on Monday.
TAIWAN DOLLAR SURGE
In currency markets, it was the Taiwan dollar that hogged the spotlight after a second straight session of sharp gains against the U.S. currency.
The Taiwan dollar rallied around 3% to as high as 29.59 per U.S. dollar . It was last trading at 30.14.
Its almost 6% surge over the past two trading sessions has stoked speculation of a revaluation of Asian currencies to win U.S. trade concessions and underscores a broader re-rating of the region’s economic prospects.
“The Taiwan dollar is appreciating at a faster pace than I’ve ever seen,” said one senior Taiwanese financial industry executive, speaking to Reuters on condition of anonymity as they were not authorized to speak to the media.
“Hot money is coming into Taiwan, and the central bank is allowing it,” they added.
In London trade, subdued by a UK national holiday, the euro firmed 0.3% to $1.1336 , while the dollar slipped 0.7% to 143.93 yen .
Australia’s dollar rallied to a five-month peak at around $0.6494 , showing little reaction to Saturday’s Australian election win for the centre-left Labor Party.
Market focus turned to this week’s meeting of the Federal Reserve, which is expected to keep rates steady.
Trump said on Sunday he would not remove Jerome Powell as Federal Reserve Chair before his term ends in May 2026 while describing the central banker as “a total stiff” and repeating calls for the Fed to lower interest rates.
“The main event is the Fed and what is happening in politics has not been forgotten,” said Nordea’s von Gerich.
Elsewhere in Europe, there was some focus on Romania where hard-right eurosceptic George Simion won the first round of Romania’s presidential election rerun on Sunday.
A Simion victory could isolate Romania, erode private investment and destabilise NATO’s eastern flank, where Ukraine is fighting a three-year-old Russian invasion, political observers say.
Reporting by Dhara Ranasinghe. Additional reporting by Wayne Cole in Sydney. Editing by Mark Potter and Ros Russell
Our Standards: The Thomson Reuters Trust Principles.
Senior correspondent on the London markets team covering European sovereign bond markets and big macro and financial themes.
