Geoffrey Smith 

Investing.com — The U.S. President Joe Biden plans to make a huge release from his Strategic Petroleum Reserve, in an effort to lower gasoline prices before the midterms. OPEC will meet with Russia, and the other partners. It is likely to turn off some of its taps. U.S. data regarding personal income and spending are expected, along with the Fed’s February update on the preferred measure of inflation. Walgreens announces earnings. China’s manufacturing industry is in contraction due to Covid-19 lockdowns that have hampered activity. What you need to know for financial markets on Thursday, March 31st.

1. Biden announces SPR release

According to multiple reports, U.S. President Joe Biden plans to announce that he will release as much as 1,000,000 barrels per day from the Strategic Petroleum Reserve for six months. This is in an effort to lower oil prices.

Biden will be under increasing pressure to lower gasoline prices enough to make an impact on inflation. This would allow him to avoid being a problem in the November midterm elections.

This year’s planned release is much bigger than that of the previous effort to reduce prices earlier in the year. It also comes at an ebb moment for oil prices. However, it doesn’t alter the fact that the SPR is conceived as a reserve against physical shortages of oil, rather than a mechanism for  pushing the market one way or the other.

Futures fell 6.2% to $101.19 per barrel by 6:15 ET. Oil prices were also down 5.3% to $105.48 per barrel

2. OPEC+ meets as Lavrov looks for other buyers for Indian oil

Biden’s initiative is timed to coincide with the latest monthly meeting of the so-called OPEC+ group, which is expected to sign off on another routine increase of 400,000 barrels a day. OPEC’s ministerial meeting starts at 8 AM ET (1200 GMT), and Russia and others will join half an hour later.

While Alexander Novak, Deputy Prime Minister, is at OPEC to meet with them, Sergey Lavrov, Foreign Minister, is visiting Delhi to negotiate terms for a mechanism that would enable India to purchase more Russian oil without having to use the dollar-based financial system.

Russia’s oil system still faces constraints due to a buyers’ strike in Europe. Reuters reported that numerous refineries had either stopped or reduced their operations as a result of inability to find international buyers. Transneft however, reduced the oil it accepted from major producers.

3. U.S. data shows consumer spending pressure

U.S. government will publish February personal income and expenditure data. This information is likely to be used for further analysis in order to determine if there was any evidence of spending slowing down as savings from the pandemic are reduced.

January’s spending figures had shown a surprisingly strong 2.1% gain, but February’s are more likely to be influenced by the continuing surge in consumer prices, more data on which will be available in the price index for personal consumer expenditures in February, which are also due at 8:30 AM ET.

There are also weekly jobless claims.

Overnight, data in Europe pointed to an increasing battle with stagflation, with U.K. house prices rising at an 18-year high, German retail sales falling in February (even before Russia’s war with Ukraine) and French inflation running way ahead of expectations. The European Central Bank is expected to tighten its stance by 2020 by about 60 basis points.

4. Walgreens and stocks set to open in a mixed manner

The U.S. stock market is expected to open in mixed conditions later. The sharp fall in crude oil prices during the past two days has provided some support for equities, despite continued fears of inflation and tighter monetary policy.

By 6:20 AM ET, were down 11 points – effectively flat – while were up 0.1% and were up 0.3%. As the Kremlin stifles hopes of a swift end to the conflict in Ukraine, all three indexes were down on Wednesday. Preparations for a ceasefire have not been made, as President Vladimir Putin informed Mario Draghi (the Italian Prime Minister) earlier.

Walgreens is expected to report its quarterly earnings later this week, as well CVS which reported a $484 million settlement in relation to opioid-related issues on Wednesday. Intel (NASDAQ: ) might also face scrutiny, after Pat Gelsinger was awarded a large options package. The package has been criticized by proxy shareholder service ISS.

5. China’s factory workers struggle with Covid. Shanghai will extend lockdown

China’s manufacturing sector slipped back into contraction in March, under the impact of Covid-19 lockdowns and waning demand from the U.S. and Europe as pandemic-era stimulus programs fade.

In the face of ongoing problems with factory and port closures, the official manufacturing Purchasing Managers Index dropped to 49.5. Overnight, the South China Morning Post reported that Shanghai might extend its Pudong District lockdown past the Friday deadline.

Elsewhere, the impact of a Chinese boycott was again evident in figures released by Swedish fashion retailer H&M, whose quarterly profit fell well short of expectations. The chain, which has 6th largest market in China, has had to shut down its Russian stores and is now accelerating its plans for closing net stores this year.