Oil Edges Lower On Demand Worries

Trading 09 août 2018 Commentaire »

Crude oil prices declined on Thursday, extending previous session's weakness, amid concerns the U.S.-China trade war could result in a drop in demand for crude.

On Wednesday, China slapped additional import tariffs of 25% on $16 billion worth of U.S. goods in retaliation for tariffs on China imposed by U.S. President Donald Trump.

Another factor set to weigh on global markets is the U.S.' decision to impose new sanctions on Russia over the poisoning of former Russian spy Sergei Skripal. The sanctions would take effect around August 22.

Saying that its too early for possible retaliatory sanctions to be discussed, Russia reiterated it was not involved in the poisoning of the former spy.

Crude oil futures for September delivery ended down $0.13, or 0.2%, at $66.81 a barrel. On Wednesday, crude oil futures ended down $2.23, or 3.2%, at $66.94 a barrel, recording its biggest slide in over three weeks.

Crude oil prices edged higher earlier this week, amid rising concerns about global crude supply after U.S. reimposed sanctions on Iran. The first wave of sanctions against Iran came into effect at 12:01 on Tuesday.

U.S. said more sanctions targeting Iran's oil sector and Central Bank will come into effect in November.

A notable drop in Saudi Arabia's crude output last month and supply disruptions in Venezuela and Libya hurt as well.

Data released by the Energy Information Administration on Wednesday revealed U.S. crude stockpiles fell by 1.351 million barrels for the week ended August 3, as against a forecast for a drop of over 3 million barrels.

According to a report released by the American Petroleum Institute a day earlier, U.S. crude inventories dropped by 6.02 million barrels last week, much more than a 3 million barrels fall predicted by a survey by Bloomberg.


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Treasuries Move Notably Higher After Ending Previous Session Roughly Flat

Trading 09 août 2018 Commentaire »

After ending the previous session roughly flat, treasuries showed a notable move to the upside during trading on Thursday.

Bond prices moved higher early in the session and remained firmly positive throughout the day. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 3.6 basis points to 2.935 percent.

The strength among treasuries came following the release of several U.S. economic reports after several days on the U.S. economic front.

In U.S. economic news, the Labor Department released a report showing first-time claims for unemployment benefits unexpectedly edged lower in the week ended August 4th.

The report said initial jobless claims dipped to 213,000, a decrease of 6,000 from the previous week's revised level of 219,000.

Economists had expected jobless claims to inch up to 220,000 from the 218,000 originally reported for the previous week.

A separate report released by the Labor Department showed producer prices unexpectedly came in unchanged in the month of July.

The Labor Department said its producer price index was unchanged in July after rising by 0.3 percent in June. Economists had expected producer prices to increase by 0.2 percent.

Excluding food and energy prices, the core producer price index inched up by 0.1 percent in July after climbing by 0.3 percent in the previous month. Core prices had been expected to rise by 0.2 percent.

Meanwhile, the Commerce Department released a report showing a modest uptick in wholesale inventories in the month of June.

Traders largely shrugged off the results of the Treasury Department's auction of $18 billion worth of thirty-year bonds, which attracted slightly below average demand.

The thirty-year bond auction drew a high yield of 3.090 percent and a bid-to-cover ratio of 2.27, while the ten previous thirty-year bond auctions had an average bid-to-cover ratio of 2.35.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

Trading on Friday may be impacted by reaction to the Labor Department's report on consumer prices in the month of July. Consumer prices and core consumer prices are both expected to rise by 0.2 percent.


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Dollar Rising On Positive Employment Data

Trading 09 août 2018 Commentaire »

The dollar is gaining ground against its major rivals Thursday afternoon. Following three days of little to no economic data, investors were given a trio of U.S. economic reports this morning, including some better than expected employment data.

First-time claims for U.S. unemployment benefits unexpectedly edged lower in the week ended August 4th, according to a report released by the Labor Department on Thursday. The report said initial jobless claims dipped to 213,000, a decrease of 6,000 from the previous week's revised level of 219,000.

Economists had expected jobless claims to inch up to 220,000 from the 218,000 originally reported for the previous week.

A report released by the Labor Department on Thursday showed producer prices unexpectedly came in unchanged in the month of July. The Labor Department said its producer price index was unchanged in July after rising by 0.3 percent in June. Economists had expected producer prices to increase by 0.2 percent.

Wholesale inventories in the U.S. saw a slight increase in the month of June, according to a report released by the Commerce Department on Thursday. The Commerce Department said wholesale inventories inched up by 0.1 percent in June after rising by 0.3 percent in May. Economists had expected wholesale inventories to come in unchanged.

The European Central Bank said uncertainties related to global factors, notably the threat of protectionism remain prominent.

In the Economic Bulletin, released Thursday, the ECB said the risk of persistent heightened financial market volatility continues to warrant monitoring.

Nonetheless, the bank said risks surrounding the euro area growth outlook were broadly balanced.

The dollar slid to an early low of $1.1619 against the Euro Thursday, but has since climbed to around $1.1550.

The buck fell to a low of $1.2912 against the pound sterling Thursday morning, but has since bounced back to around $1.2850.

The greenback rose to a high of Y111.184 against the Japanese Yen Thursday morning, but has since eased back to around Y110.965.

The total number of core machine orders in Japan tumbled a seasonally adjusted 8.8 percent on month in June, the Cabinet Office said on Thursday - worth 827.6 billion yen. That was well shy of forecasts for a drop of 1.0 percent after sliding 3.7 percent in May.


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Gold Ends Marginally Lower

Trading 09 août 2018 Commentaire »

Gold prices edged down marginally on Thursday, with traders choosing to stay long with riskier assets after data showed initial jobless claims came in less than expected last week and producer price inflation stayed flat in July.

Data released by the Labor Department showed producer prices in U.S. unexpectedly came in unchanged in the month of July, after rising 0.3% in June. Economists had expected producer prices to increase by 0.2%.

Compared to the same month a year ago, producer prices in July were up by 3.3%, reflecting a modest slowdown from the 3.4% increase in June.

Another report from Labor Department showed first-time claims for unemployment benefits unexpectedly edged lower in the week ended August 4th. The report said initial jobless claims dipped to 213,000, a decrease of 6,000 from the previous week's revised level of 219,000. Economists had expected jobless claims to inch up to 220,000.

The dollar held gains against most major currencies. The dollar index was up 0.33 or 0.35% at 95.28.

Gold futures for December ended down $1.10, or about 0.1%, at $1,219.90 an ounce.

Gold futures ended at $1,221.00 an ounce on Wednesday, gaining $2.70, or 0.2%.

Silver futures for September were up $0.023, or 0.15%, at $15.455 an ounce. Copper futures were higher by $0.013, or 0.47%, at $2.764 per pound.

Meanwhile, markets are looking ahead to the outcome of trade talks between the United States and Japan later in the day.

Trade war concerns are rising by the day. On Wednesday, China slapped additional import tariffs of 25% on $16 billion worth of U.S. goods in retaliation for tariffs on China imposed by U.S. President Donald Trump.

Also on Wednesday, Washington said it would soon impose new sanctions on Russia after determining Moscow had used a nerve agent in the attack against a former Russian spy in Salisbury.

Another factor set to weight on global markets is the U.S.' move to impose new sanctions on Russia over the poisoning of former Russian spy Sergei Skripal. The sanctions would take effect around August 22.

Saying that its too early for possible retaliatory sanctions to be discussed, Russia reiterated it was not involved in the poisoning of the former spy.

Following U.S.' decision to impose sanctions on Russia, the rouble sank to near two-year lows against the U.S. dollar today.


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U.S. Wholesale Inventories Unexpectedly Inch Up 0.1% In June

Trading 09 août 2018 Commentaire »

Wholesale inventories in the U.S. saw a slight increase in the month of June, according to a report released by the Commerce Department on Thursday.

The Commerce Department said wholesale inventories inched up by 0.1 percent in June after rising by 0.3 percent in May. Economists had expected wholesale inventories to come in unchanged.

The uptick in wholesale inventories reflected an increase in inventories of durable goods, which climbed by 0.8 percent in June following a 0.3 percent increase in May.

Notable increases in inventories of metals, miscellaneous durable goods and lumber more than offset a steep drop in automotive inventories.

Meanwhile, the report said inventories non-durable goods slumped by 1.0 percent in June after rising by 0.4 percent in May.

The sharp drop in inventories of non-durable goods was partly due to a substantial decrease in inventories of farm products.

The Commerce Department also said wholesale sales edged down by 0.1 percent in June following a 2.1 percent jump in the previous month.

Sales of durable goods rose by 0.2 percent in June after surging up by 1.4 percent in May, while sales of non-durable goods fell by 0.3 percent after spiking by 2.8 percent.

With inventories and sales both showing only modest moves, the inventories/sales ratio for merchant wholesalers was unchanged from the previous month at 1.25.


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*U.S. Wholesale Inventories Inch Up 0.1% In June

Trading 09 août 2018 Commentaire »

U.S. Wholesale Inventories Inch Up 0.1% In June


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Pound Climbs Amid Rumors Of Brexit Concession To May

Trading 09 août 2018 Commentaire »

The pound advanced against its major counterparts in the European session on Thursday, reversing early losses, after media reports showed that European leaders are willing to grant major concession in Brexit deal by permitting to stay in the single market for goods while ending the free movement of people.

Reports suggested that EU member states are mulling a deal to let the U.K. remain in the single market and terminate free movement, if it accepts new EU rules for years to come.

Member states are likely to propose that UK replicated all environmental, social, and customs rules in return for such a deal, reports said.

Survey by the Royal Institution of Chartered Surveyors showed that UK rentals are expected to increase 15 percent over the next five years on weaker supply.

Over the coming twelve months, an increase of about 2 percent in rentals is expected. Respondents observed that small landlords are quitting the rental sector due to tax changes.

The currency was lower against its major counterparts in the Asian session.

The pound climbed to 0.8986 against the euro, from a 10-month low of 0.9030 seen at 9:15 pm ET. The pound is poised to find resistance around the 0.88 level.

Having fallen to near a 1-year low of 1.2842 against the greenback at 3:30 am ET, the pound reversed direction and advanced to 1.2912. The next likely resistance for the pound is seen around the 1.32 level.

The pound advanced to 143.50 against the yen, after falling to more than an 11-month low of 142.35 at 9:15 pm ET. The pound is seen finding resistance around the 146.00 area.

Data from the Bank of Japan showed that Japan's M2 money stock rose 3.0 percent on year in July, coming in at 1,007.5 trillion yen.

That was shy of expectations for an increase of 3.1 percent, which would have been unchanged from the June reading.

The pound reversed from an early more than 10-month low of 1.2769 against the franc, rising to 1.2818. On the upside, 1.27 is possibly seen as the next resistance level for the pound.

Data from the State Secretariat for Economic Affairs showed that Switzerland's unemployment rate remained unchanged in July.

The jobless rate held steady at seasonally adjusted 2.6 percent in July, in line with expectations.

Looking ahead, U.S. wholesale inventories for June are due at 10:00 am ET.


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U.S. Producer Prices Unexpectedly Flat In July

Trading 09 août 2018 Commentaire »

A report released by the Labor Department on Thursday showed producer prices unexpectedly came in unchanged in the month of July.

The Labor Department said its producer price index was unchanged in July after rising by 0.3 percent in June. Economists had expected producer prices to increase by 0.2 percent.

The unchanged reading on producer prices came as a 0.1 percent uptick by the index for final demand goods was offset by a 0.1 percent dip in prices for final demand services.

Excluding food and energy prices, the core producer price index inched up by 0.1 percent in July after climbing by 0.3 percent in the previous month. Core prices had been expected to rise by 0.2 percent.

Compared to the same month a year ago, producer prices in July were up by 3.3 percent, reflecting a modest slowdown from the 3.4 percent increase in June.

The annual rate of growth in core producer prices also slowed to 2.7 percent in July from 2.8 percent in the previous month.

On Friday, the Labor Department is scheduled to release a separate report on consumer price inflation in the month of July. Consumer prices and core consumer prices are both expected to rise by 0.2 percent.


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U.S. Weekly Jobless Claims Unexpectedly Edge Down To 213,000

Trading 09 août 2018 Commentaire »

First-time claims for U.S. unemployment benefits unexpectedly edged lower in the week ended August 4th, according to a report released by the Labor Department on Thursday.

The report said initial jobless claims dipped to 213,000, a decrease of 6,000 from the previous week's revised level of 219,000.

Economists had expected jobless claims to inch up to 220,000 from the 218,000 originally reported for the previous week.

The Labor Department said the less volatile four-week moving average edged down to 214,250, a decrease of 500 from the previous week's revised average of 214,750.

Meanwhile, the report said continuing claims, a reading on the number of people receiving ongoing unemployment assistance rose by 29,000 to 1.755 million in the week ended July 28th.

The four-week moving average of continuing claims also inched up to 1,745,250, an increase of 3,000 from the previous week's revised average of 1,742,250.

Last Friday, the Labor Department released a separate report showing much weaker than expected job growth in the month of July.

The Labor Department said non-farm payroll employment climbed by 157,000 jobs in July after spiking by an upwardly revised 248,000 jobs in June.

Economists had expected employment to increase by about 190,000 jobs compared to the jump of 213,000 jobs originally reported for the previous month.

Despite the weaker than expected job growth, the unemployment rate edged down to 3.9 percent in July from 4.0 percent in June, matching estimates.


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U.S. Producer Prices Unexpectedly Unchanged In July

Trading 09 août 2018 Commentaire »

A report released by the Labor Department on Thursday showed producer prices unexpectedly came in unchanged in the month of July.

The Labor Department said its producer price index was unchanged in July after rising by 0.3 percent in June. Economists had expected producer prices to increase by 0.2 percent.

Excluding food and energy prices, the core producer price index inched up by 0.1 percent in July after climbing by 0.3 percent in the previous month. Core prices had been expected to rise by 0.2 percent.


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