OIL PRODUCTS: Mid-Day Oil Products Summary: Cracks Mostly Steady

• In the FI space, the pullback from recent highs in Bund futures appears corrective and a short-term bull cycle remains in play - for now. The Jan 15 rally highlighted a reversal signal - a bullish engulfing candle. It continues to suggest scope for a corrective phase that is allowing an oversold trend condition to unwind. Sights are on 132.10, the 20-day EMA. A clear breach of the average would strengthen the bullish theme. The bear trigger is 130.28, the Jan 15 low. Initial support lies at 131.00, the Jan 16 / 24 low.
• The medium-term trend condition in Gilt futures remains bearish. However, recent gains continue to highlight a corrective phase and signal scope for a continuation higher near-term. The contract has traded through the 20-day EMA, at 91.76. The focus is on 92.75, the 50.0% retracement of the Dec 3 - Jan 13 bear leg. Initial support is at 91.10, the Jan 20 low.

Speaking to Bloomberg TV, PM Sir Keir Starmer has claimed that the British economy is showing signs of a positive turn-around. Starmer's comments come a day ahead of a major speech from Chancellor of the Exchequer Rachel Reeves, who is expected to back major planning reforms and infrastructure projects as part of the gov'ts 'strategy for growth'. 

• Earlier Starmer claimed “We have to get our economy working. I think we’re beginning to see how that’s turning around,” saying that his gov't would “strip away regulation, strip away the inhibition of planning and use AI to take us forward". Weak economic expansion and declining business confidence have dealt a blow to the Starmer gov'ts claims that "The number one priority of this Labour government is growth: growth, growth, growth.”
• Seemingly still no set time for Reeves' address to be delivered in Oxford, with The Telegraph reporting a window for the address as "Wednesday morning."
• The most eye-catching headlines from Reeves' speech could centre on the gov'ts support for the expansion of three major London-adjacent airports: Heathrow, Gatwick and Luton. This change in stance - Starmer previously opposed a third runway for Heathrow - could risk rifts in Cabinet with Energy Secretary Ed Miliband seen as a staunch opponent of expanding airports.
• Public trust in Labour's ability to manage the economy continues to slide, with the latest poll from Ipsos showing 27% of respondents choosing the party as their most trusted. While this is still ahead of the main opposition centre-right Conservatives on 21%, the gap between the two is the narrowest since late 2022. 

Chart 1. Opinion Poll 'Party most trusted to manage Britain's economy', %

Source: Ipsos, Daily Telegraph

SFIJ5/M5 95.95/96.05cs calendar spread, bought the June for 1 in 8k total.