Oil market volatility returns

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  • European shares slumped sharply on Tuesday because of poor performance of companies such as BP and UBS, as well as the renewed decline in oil prices. The pan-European FTSEurofirst 300 index slid 1.8 percent, since the beginning of the year the index has lost 7% of its value. Major national indexes like the German DAX, the French CAC 40 and the UK's FTSE 100 fell by between 1.2 and 1%.

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    Shares in Swiss bank UBS fell 7.8% after reporting a surprising contraction in business management of capital. This overshadow financial results are the best since 2010, as well as increased dividends. Shares of British oil giant

    A drop in oil

    In the last days of last week the quotations of oil recorded strong growth amid hopes that OPEC and other major producers would agree to balance the market by reducing yield. But prices went down again because of concerns of growing oversupply and weakness of China's economy, which is one of the largest consumers of energy resources. The official statistics of the Ministry of Energy of Russia shows that in January extraction in the country has reached a new post-Soviet record of 10.88 million. Barrels per day. Then dropped by around 7 percent on Monday, Tuesday Brent crude fell more nearly 5% to 32.60 dollars per barrel. When US light crude was decrease by 4.2% to 30.30 dollars per barrel.

    On currency markets the increased demand for safe assets led to the appreciation of the Japanese yen and the euro against the US dollar. Meanwhile, the dollar rose more than 1 percent against the currencies of many emerging markets such as the Russian ruble, South African rand, Mexican peso and Malaysian Rigi. The rate of the Australian dollar also fell because the central bank signaled it is ready to loosen its monetary policy in response to the introduction of negative interest rates in Japan.

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