Upbeat retail sales, rising U.S. equities give prices some support
By Claudia Assis and V. Phani Kumar, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures veered between small gains and losses Tuesday, getting some support from an upbeat retail sales report but dragged by a higher dollar ahead of the Federal Reserve’s monetary-policy decision.
Crude for April delivery CLJ2 +0.45% gained 21 cents, or 0.2%, to trade at $106.55 a barrel on the New York Mercantile Exchange. It traded as low as $105.67 a barrel and as high as $107.13 a barrel earlier.
The contract declined 1% on Monday in the wake of a larger-than-expected trade deficit in China, which stoked fears of an economic slowdown and less demand for oil.
On Tuesday, however, the flow of macroeconomic data was mostly positive. The U.S. Commerce Department said February retail sales climbed 1.1%, with growth rates for January and December revised higher.
Earlier Tuesday, a gauge of German investor sentiment, the ZEW index, jumped sharply in March to its highest level since June 2010. The sentiment indicator rose to 22.3 from 5.4 in February, well above economists’ expectations of a 10.0 reading.
Meanwhile, the Fed is scheduled to announce its policy decision later Tuesday. Investors expect it to stand pat on interest rates and will likely refrain from providing any clues on its exit strategy from the current accommodative stance. Read a preview of the Fed’s decision.
The American Petroleum Institute is slated to release its weekly report on inventories later Tuesday. That precedes the more closely watched report by the Department of Energy, due Wednesday.
The dollar kept being a drag for oil and other commodities. The ICE dollar index DXY +0.12% , which measures the greenback’s performance against a basket of six major rivals, traded at 80.058 from 79.869 in late North American trading on Monday.
A higher dollar is a negative for the dollar-denominated commodities as it makes them more expensive to holders of other currencies.
Elsewhere in the energy complex, gasoline and heating oil futures added to earlier gains. April gasoline RBJ2 +0.87% advanced 2 cents, or 0.7%, to $3.35 a gallon. April heating oil HOJ2 +0.65% rose 1 cent, or 0.4%, to $3.26 a gallon.
April natural-gas futures NGJ12 -2.38% dropped 5 cents, or 2.3%, to $2.22 per million British thermal units, hovering at a 10-year low. The contract on Monday settled at a 10-year low.
