News Column

Crude Oil Ends Flat On Iraq Concerns, Upbeat Data

June 16, 2014

WASHINGTON (Alliance News) - US crude oil snapped a three-day gain to end a tad lower Monday, despite the escalating violence in Iraq with reports suggesting the oil producing areas in the country to be largely insulated from the strife. Nonetheless, fears of supply disruption from the beleaguered country remained, even as news reports said the US could collaborate with Iran to help the Iraqi government bring the country under its control.

Investors also weighed some upbeat economic data from the US with both industrial production and homebuilder confidence rising more than expected.

Light Sweet Crude Oil futures for July delivery, the most actively traded contract, edged down USD0.01 to close at USD106.90 a barrel on the New York Mercantile Exchange Monday.

Crude prices for July delivery scaled a high of USD107.54 a barrel intraday and a low of USD106.61.

Last week, crude oil gained about 4.1%, the biggest weekly gain in a year, amid escalating violence in Iraq with militants pushing toward the capital city.

The dollar index, which tracks the US unit against six major currencies, traded at 80.47 on Monday, down from its previous close of 80.61 late Friday in North American trade. The dollar scaled a high of 80.71 intraday and a low of 80.42.

The euro traded higher against the dollar at USD1.3568 on Monday, as compared to its previous close of USD1.3541 late Friday in North American trade. The euro scaled a high of USD1.3580 intraday and a low of USD1.3514.

In economic news from the US, a report from the Federal Reserve of New York showed that manufacturing activity in New York region to have risen unexpectedly in June with the Empire State general business conditions index inching up to 19.3, from 19.0 in May. Economists expected the index to slip to 15 in June.

In a separate report, the Federal Reserve said industrial production in May increased by 0.6% following a revised 0.3% decrease in April. Economists expected production to climb by about 0.5%.

A report from the National Association of Home Builders showed homebuilder confidence to have improved more than expected in June. The NAHB/Wells Fargo Housing Market Index climbed to 49 in June from 45 in May. Economists expected the index to edge up to 47.

Meanwhile, the two-day Federal Reserve meeting kick starts on Tuesday, with the central bank also scheduled to release its updated forecasts apart from the post-meeting policy statement.

Investors will be looking ahead to the Commerce Department's housing starts report for May and the jobless claims report this week.

Additionally, the Labor Department's consumer prices report for May, the Commerce Department's quarterly current account report, the Conference Board's leading economic indicators index for May and announcements concerning the Treasury auctions of 2-year, 5-year and 7-year notes are also due this week.

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Source: Alliance News

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