Brent drops toward $59 as dollar firms on U.S. jobs data

SINGAPORE - Brent crude fell toward $59 a barrel on Monday as a promising U.S. jobs report pushed the dollar up, offsetting geopolitical tensions and the threat of output cuts in Libya and Iraq.

The dollar hit a more than 11-year high against a basket of currencies after data showed the U.S. unemployment rate fell to the lowest since May 2008 in February, making commodities priced in the greenback costlier for holders of other currencies

Brent eased 43 cents to $59.30 by 0445 GMT, after dropping 75 cents in the previous session. It fell 4.6 percent last week in its biggest decline since the week ended Jan. 9.

U.S. crude was down 27 cents at $49.34. It closed down $1.15 on Friday to complete a third week of declines.

Goldman Sachs  said in a note that oil prices would reverse recent gains on rising global inventories, with U.S. crude expected to drop to around $40 a barrel.

Oil prices rose by almost a third between January and February on the back of Middle East supply disruptions, strong winter demand and high refinery margins.

But the focus is now on the dollar, analysts said.

"The U.S. dollar is continuing to strengthen. In the short-term it's more about the dollar than anything else," said Ben LeBrun, market analyst at Sydney's OptionsXpress.

U.S. economic data to be released on Tuesday could lead to a further strengthening of the U.S. dollar which would be negative for commodities including oil, said LeBrun.

He said geopolitical issues in North Africa and the Middle East "are all playing second fiddle to the U.S. dollar".

Goldman said in its note that "absent further unexpected OPEC disruptions, we expect Brent oil prices and timespreads to reverse their recent strength".

Members of the Organisation of the Petroleum Exporting Countries (OPEC) should not cut output to "subsidize" higher-cost shale, OPEC Secretary-General Abdullah al-Badri has said.

In Libya, up to 10 foreign workers are missing in the latest attack on the country's oil fields by Islamist militants and there is a possibility they have been taken hostage, Czech and Libyan officials said on Saturday.

Brent should trade within a range of $55.36-$63.04 this week, said Singapore's Phillip Futures in a note on Monday.

U.S. crude should trade between $48.45-$55.02 although prices could move sharply upwards if the U.S. refinery strikes end this week, Phillip Futures said.

source: interaksyon.com

Oil prices rise ahead of US jobs report

SINGAPORE, October 3, 2014 (AFP) - The cost of oil rose in Asia Friday ahead of the latest US jobs report and after hitting multi-month lows a day earlier in response to key exporter Saudi Arabia cutting prices.

US benchmark West Texas Intermediate (WTI) for November delivery rose 16 cents to $91.17 while Brent crude for November gained 11 cents to $93.53 in mid-morning trade.

Singapore's United Overseas Bank (UOB) said investors are keenly eyeing the release of the September US jobs report later Friday.

"For the September non-farm payrolls, markets are looking at a job creation of 215,000, up from 142,000 in August, while unemployment is expected to stay unchanged at 6.1 percent," UOB said.

US jobs figures are closely watched by crude investors for clues on the state of economic recovery and demand in the world's top oil consumer.

The gains on Friday come after WTI prices tumbled below $90 in New York intra-day trade following Riyadh's announcement of lower prices for the fourth straight month.

WTI retreated to $88.18 -- a level last seen on April 23, 2013 -- before recovering to $91.01.

In London, Brent dropped to $91.55 a barrel, last hit in June 2012, but later rebounded to $93.42 at the close.

Analysts say the move by Saudi Arabia, OPEC's biggest producer, signals its focus on maintaining market share amid a broader increase in production by rivals.

source: interaksyon.com

S&P 500 ends at record as jobs report eases Fed worries

NEW YORK - U.S. stocks ended higher on Friday, lifting the S&P 500 to a fresh closing high, after a weaker-than-expected jobs report was taken as a sign that the Federal Reserve will not begin raising interest rates anytime soon.

Stocks had traded lower after the government reported fewer U.S. jobs were created in August than expected.

By early afternoon, however, major indexes turned positive, led by utilities. Fed officials have made it clear that they see the labor market as still struggling, which partially justifies keeping rates at rock-bottom levels.

"The nonfarm payroll numbers fell well short of expectations, but the market reaction suggests a stronger-than-consensus number might have been met with a downward bias in equities," said Jim Russell, senior equity strategist at U.S. Bank Wealth Management in Cincinnati.

"What we saw today called off the dogs to some degree and took the heat down a notch or two from investors' concern about rate hikes."

Utilities gained 1.2 percent as investors turned to the group for their income appeal with bond yields falling in response to the payrolls data. Utility shares often benefit as bond yields fall because the companies pay relatively rich dividends.

Power generator NRG Energy Inc rose 1.9 percent to $30.89, and XCEL Energy Inc advanced 1.9 percent to $32.48.

The Dow Jones industrial average rose 67.78 points, or 0.4 percent, to 17,137.36. The S&P 500 was up 10.06 points, or 0.5 percent, to 2,007.71. The Nasdaq Composite added 20.61 points, or 0.45 percent, to 4,582.90.

For the week, the Dow and the S&P each gained 0.2 percent and the Nasdaq rose 0.06 percent.

Family Dollar Stores Inc shares lost 1.2 percent to $79.11 after the discount retailer rejected Dollar General Corp's sweetened takeover bid. Shares of Dollar General fell 2.3 percent to $63.01.

Apple shares edged up 0.9 percent to $98.97 after the company said it planned to add new security features to its iCloud service.

Retailers lost ground. Michael Kors shares lost 4.5 percent to $76.39 after the company announced a secondary offering of 11.6 million shares.

Gap Inc shares fell 4.2 percent to $44.65 after worse-than-expected same-store-sales in August.

About 5.2 billion shares traded on all U.S. platforms, according to BATS exchange data, compared with the five-day average of 5.1 billion.

source: interaksyon.com