MUMBAI: US crude oil futures edged lower to trade near their three-week lows, under $73 per barrel, after a spate of weak manufacturing data reflected slowing global economic growth, leaving investors looking to Friday’s US unemployment report for further direction.
West Texas Intermediate (WTI) for August shed 12 cents to $72.83 a barrel, after touching $72.05 on Thursday, the lowest intraday price since June 9.
Front-month WTI has declined every day this week, with the biggest drop on Thursday, when it slumped 3.5% to $72.95.
Manufacturing growth cooled around the world in June, with China hitting its slowest pace in more than a year and growth in the US and Europe also easing -- further evidence that the global economic recovery is moderating.
The ISM report disappointed markets as the data of pending sales of previously owned homes, which plunged a record 30% in May to an all-time low.
Energy provider Genscape said on Thursday that Cushing, Oklahoma crude stocks fell 285,000 in the week to Tuesday. The recent slip from the record high storage at the Cushing hub has helped narrow the price spread between the front-month and near-month crude contracts, leaving it at 51 cents on Thursday, based on settlement prices.
After helping drive crude prices to above $79 on Monday, Hurricane Alex made a landfall on Thursday, sparing US oil facilities near its path.
Gold fell to a 5-week low before bouncing slightly, having fallen nearly 4% the previous day as funds sold bullion to cover losses in other markets, while ETF holdings dropped for the first time since June.
Spot gold hit a low of $1,196.00, its weakest since May 25, before rebounding to $1,206.90 ounce, up by $5.10 from New York’s notional close, as the Nikkei edged up and the euro held steady. Gold struck a record $1,264 last week.
US gold futures for August delivery fell $3 an ounce to $1,203.7.
The world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings dropped to 1,319.22 tonnes by July 1 from a record of 1,320.44 tonnes on June 29.
Base metal counters recovered after the Australian government compromised a mining tax deal, which is expected to unlock a stalled pipeline of mergers and acquisitions in the booming resources sector.
Also, traders rushing to cover their positions ahead of the weekend session helped prices to recover. Further, the strength in equities perked up sentiment.
Copper futures led the recovery in other metal counters. On Thursday, copper fell to a three-week low as risk-aversion gathered steam after weak macro economic data from the United States and top consumer China raised doubts about the pace and strength of the global economic recovery.
On the London Metal Exchange (LME), benchmark copper for three months delivery slipped $175 to end at $6,335 a tonne, near a session low of $6,318. It was last quoting 1.5% higher at $6,422 a tonne.
Investors are now watching for non-farm payroll data from US.
Meanwhile, select domestic agri-commodity counters have witnessed fresh trading interest after the met department announced that the key northern region has received 13% below average rain-fall last month.
Counters such as guar seed, guar gum, turmeric and soybean have advanced on hopes that the lack of adequate rains would hamper yield, and hence, there will be a lesser availability of these produce in the markets.
NCDEX guar seed July contract added nearly 1% to Rs 2,344 per quintal. Similarly, guar gum August contract added over 1% to trade at Rs 5,128 per 100kg.
Turmeric futures sizzled since morning. The current month contract was last quoting Rs 140 higher at Rs 14,146 per quintal. Soybean seed, jeera and wheat were some of the counters that have gained smartly in today’s session.
