BLBG:Gasoline Jumps With Oil On Supply Disruptions; Ringgit Declines
Oil gained the most in a week as Tropical Storm Isaac shut Gulf of Mexico production and gasoline reached a four-month high after a refinery explosion in Venezuela killed 39 people. Asian currencies fell on concern global economic growth is slowing.
Oil climbed 1.3 percent to $97.42 a barrel at 1:08 p.m. in Tokyo and gasoline jumped 4.1 percent to $3.205 a gallon, the highest since April. Soybeans reached a record $17.605 a bushel. Samsung Electronics Co. slumped 6.8 percent after a U.S. jury ordered the company to pay more than $1 billion to Apple Inc. for infringing patents, dragging the MSCI Asia Pacific Index down by 0.1 percent. The Indian rupee and Malaysia’s ringgit weakened 0.2 percent. Futures on the Standard & Poor’s 500 Index (MXAP) advanced 0.1 percent.
About 24 percent of U.S. oil production and 8.2 percent of natural gas output from the Gulf of Mexico has been shut due to the storm. Chinese stocks dropped to a three-year low as profits at industrial companies fell by the most this year. A report today may show German business confidence fell to a two-year low, adding to signs Europe’s debt crisis is damping growth prospects.
“There’s an interesting dynamic happening,” Thomas Hilboldt, Asia Pacific head of oil, gas and petrochemicals research at HSBC Holdings Plc, said in a Bloomberg Television interview. “We’re seeing the overall economic picture in China at a decelerating pace but at the same time we’re seeing very strong oil prices,” he said. “Energy systems in general, whether it’s the production of oil or processing of oil, remain relatively tight.”
The S&P GSCI Index of commodities rose for the first time in three days. Firefighters in Venezuela are working at the country’s largest oil refinery after an explosion on Aug. 25 killed at least 39 people. Isaac is forecast to strengthen over the eastern Gulf of Mexico.
Industrial Profits
The Shanghai Composite Index dropped 1.3 percent, heading for the lowest close since March 2009, as weaker earnings underscored concern about the slowdown. Profits at industrial companies fell 5.4 percent in July from a year ago, compared with a 1.7 percent drop in June, the statistics bureau said today.
China Petroleum & Chemical Corp. (600028), Asia’s biggest refiner, fell 1 percent after posting its lowest half-yearly profit since 2008 on the sale of fuels at state-controlled prices. Xinjiang Goldwind Science & Technology Co., the country’s second-largest maker of wind turbines, dropped to a record low after reporting first-half profit slumped 83 percent.
China’s Premier Wen Jiabao urged extra measures to support exports during a tour of Guangdong, the official Xinhua News Agency said Aug. 25, as evidence mounts that the nation’s slowdown is deepening. Policy makers have limited the scale of stimulus after interest-rate cuts in June and July as they seek to spur growth without fueling inflation.
Won, Samsung
The ringgit weakened to 3.109 per dollar and the rupee dropped to 55.61 per dollar on concern that Europe is not making progress in resolving the region’s debt woes. German Vice Chancellor Philipp Roesler said in an interview with ZDF yesterday that there can be no additional help for Greece if reforms aren’t carried out.
South Korea’s won was little changed at 1,134.15 after Moody’s Investors Service raised the sovereign debt rating for the first time since 2010. The currency earlier touched a one- month low of 1,137.30. The Australian dollar was at $1.0388 after touching $1.0372, the lowest since July 26.
The euro was lower against the majority of its 16 peers before German Finance Minister Wolfgang Schaeuble meets his French counterpart today to discuss Greek budget targets. Europe’s common currency was at $1.2509 from $1.2512 on Aug. 24, and fetched 98.49 yen from 98.44.
Bernanke Hopes
Treasuries held gains from last week on speculation Federal Reserve Chairman Ben S. Bernanke will outline the case for further central bank action to support the economy at this week’s meeting of policy makers at Jackson Hole, Wyoming. The yield on the 10-year bond fell one basis point to 1.68 percent.
Bernanke “might fuel hopes that down the road, we could still see monetary stimulus from the Fed,” Vasu Menon, head of content and research for wealth management at Oversea-Chinese Banking Corp. in Singapore, said in a Bloomberg Television interview. “Wen wants to make sure when he hands over the baton that China is in fairly good shape.”
November-delivery soybeans rallied to a record as the worst U.S. drought in half a century hurt production in the world’s largest grower while export demand increased. Corn rose 1 percent and wheat climbed 0.8 percent.
Cash gold gained as much as 0.4 percent to a four-month high of $1,676.90 an ounce. Silver climbed 1 percent and copper futures in New York rose 0.1 percent. The London Metal Exchange is shut today for a holiday.
To contact the reporters on this story: Glenys Sim in Singapore at gsim4@bloomberg.net; Susan Li in Hong Kong at sli31@bloomberg.net
To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net
