The price of crude oil was little changed Tuesday morning as cooling U.S. manufacturing activity indicated that the world's largest economy is losing some strength.
Light Sweet Crude Oil (WTI) futures for May delivery, eased $0.08 to $96.99 a barrel. Yesterday, oil snapped a five-day winning streak to end lower on some disappointing production and sales data from the U.S. However, the downtrend was limited by a weak dollar and some encouraging factory sector data from China. Activity in the U.S. manufacturing sector grew at a much slower than expected rate in March, a report from the Institute for Supply Management indicated Monday. While the index showed a fourth consecutive month of growth in the manufacturing sector, economists expected a much more modest decrease.
This morning, the U.S. dollar was hovering around its four-month high versus the euro and lingering near a weekly low against sterling and the Swiss franc. The buck slipped back near a fresh one-month low versus the yen.
In economic news, operating conditions across Eurozone manufacturing sector deteriorated further in March, detailed results of a survey by Markit Economics showed. But the rate of decline in activity was less steeper than previously estimated. The headline purchasing managers' index, that measures the performance of the manufacturing sector, fell to 46.8 in March from 47.9 in February. A PMI reading below 50 indicates contraction of the sector.
Separately, final data from Markit Economics revealed Germany's manufacturing activity contracted less than estimated in March. The Markit/BME Purchasing Managers' Index dropped to 49 in March, but above the flash estimate of 48.9. The index fell into the negative zone from 50.3 in February.
Meanwhile, a report from Eurostat revealed that eurozone's unemployment rate stayed unchanged in February, matching economists' forecast. The seasonally adjusted unemployment rate was unchanged at 12 percent in February, after the January figure was revised upwards, statistical office Eurostat said Tuesday. The latest figure matched economists' expectations, and was slightly higher than the originally reported 11.9 percent. In February 2012, the jobless rate was 10.9 percent.
Traders will look to the factory orders report for February from the U.S. Commerce Department, due out at 10 a.m. ET. Economists estimate factory orders growth of 2.9 percent from the previous month.
Automakers are scheduled to release their monthly sales results for March. Economists expect auto sales to come in at a seasonally adjusted annual rate of 15.4 million units, flat with last month.
Today after the market hours, the API will release its US crude oil inventories report for the weekended March 29.
