MW: Crude climbs on European manufacturing, weaker dollar
By Laura Mandaro, MarketWatch
PORT LOUIS, Mauritius (MarketWatch) -- Crude-oil futures rose Monday, buoyed by stronger European manufacturing data and a return of investor enthusiasm for stocks, commodities and other assets seen as likely to benefit from global economic growth.
Crude for July delivery added $1.67, or 2.3%, to $75.40 a barrel on the Comex division of the New York Mercantile Exchange, extending last week's gains of more than 3%.
Supporting hopes for future energy demand, Eurostat said Monday that euro-zone industrial production climbed 0.8% in April, or a 9.5% year-on-year increase. On an annual basis, industrial production rose in every euro-zone country except Greece and Ireland.
Driving oil prices to start the trading week are two factors: the "continuing recovery in broad-based risk appetite and the higher-than-consensus results for euro-area industrial production in April," said Mike Wittner, global head of oil research at Societe Generale's corporate and investment banking unit in London, via email.
On Monday, Asian and European stocks rallied, getting an extended boost from a surprisingly strong report Friday on U.S. consumer sentiment. Stock futures pointed to a higher open for Wall Street. See Indications.
Some analysts said the absence of bad news about Europe's public debt situation -- which has been a drag on stocks globally since late April -- was also enticing investors back to equities and other so-called "risk assets."
Copper, palladium and platinum -- all metals used in industrial applications -- also rallied Monday.
In currencies, the euro strengthened against the dollar, whose drop often makes hard assets more valuable.
"Today we are seeing oil being very correlated with the U.S. dollar," said Tariq Zahir, managing director at Tyche Capital Advisors LLC, in an email interview.
The euro rose to $1.2248, up 0.7% from late North American trading Friday. The U.S. Dollar Index (DXY 86.38, -1.12, -1.28%) fell to 86.472, down about 0.6% from late Friday. See Currencies for more on dollar, euro.
