(RTTNews) - The price of crude oil was ticking lower Tuesday morning as lingering euro zone worries overshadowed data out of China that revealed minor recovery in the nation's manufacturing sector.
Preliminary results of HSBC's monthly survey of manufacturers revealed the contraction in Chinese manufacturing eased in July, with the .Purchasing Managers' Index rising to 49.5 from 48.2.
Light Sweet Crude Oil (WTI) futures for September delivery, slipped $0.21 to $87.93 a barrel. Yesterday, oil dived about 4 percent to settle near a weekly low on demand concerns with the euro zone financial problems back in focus and a strong dollar. Speculations were rife over IMF's aid to Greece and the burgeoning borrowing costs in Spain. The government bond auctions in Spain surged to an euro-era high with the 10-year note yield at 7.57 percent,
This morning, the U.S. dollar was hovering around its 2-year high versus the euro and continued to move higher against sterling. The buck was lingering around a monthly-low versus the yen and trading flat against the Swiss franc.
In economic news, the euro zone private sector economy contracted for the tenth time in the last eleven months, with the rate of decline unchanged on June, Markit Economics said. The flash composite Purchasing Managers' Index remained unchanged at 46.4 and matched the consensus forecast. A reading below 50 suggests contraction in the sector.
Further, Germany's private sector continued to shrink in July, marking the weakest performance since June 2009, Markit Economics said. The flash composite output index fell for the sixth month running in July, to 47.3 from 48.1 in June. The index has posted reading below 50 in each month since May.
Traders will look to the house price index for May from the Federal House Finance Agency, due out at 10 a.m. ET. Economists expect a 0.3 percent increase in the house price index compared to a 0.8 percent increase in April.
Today after the market hours, the API will release its U.S. crude oil inventories report for the weekended July 20.
