Market Close: July 09 UP
Jul 9th, 2015 by loren
Oil futures settled with a gain on Thursday, with U.S. prices up for the first time in six sessions, finding support as a sell off in Chinese stocks abated and difficult negotiations over Iran’s nuclear program helped ease supply worries.
Prices also got a boost as upbeat economic data about Japan and Germany lifted prospects for energy demand. August West Texas Intermediate crude rose $1.13, or 2.2%, to settle at $52.78 a barrel on the New York Mercantile Exchange, but remains more than 7% lower since the end of last week. ICE August Brent crude added $1.56, or 2.7%, to $58.61 a barrel, slicing a week-to-date loss to 2.8%.
“There have been growing concerns that the China stock market crash could destabilize the economy and cut into resource demand, which had put a lot of pressure on commodities lately,” said Colin Cieszynski, chief market strategist at CMC Markets. Equities in China Thursday made their biggest daily gain in six years. China is among the world’s top energy consumers But the gains for the Chinese markets may only be temporary. Phil Flynn, senior market analyst at Price Futures Group, referred to the Shanghai Composite’s rally as “artificial.” The index had posted declines in eight of the last 10 trading days. Also read: 5 big reasons for oil’s hefty decline this week.
Meanwhile, talks between Iran and the six Western powers have yet to make a breakthrough ahead of a deadline this week that would give the U.S. Congress an extra month to review a final deal, The Wall Street Journal reported. A deal would lift sanctions on Iran, allowing it to resume oil exports. The German trade balance saw its highest surplus on record in May, and Japanese core machinery orders unexpectedly rose 0.6% in May, defying a consensus forecast for a 4.9% drop. But because of the turmoil in Greece, the market fears the economic data may be in the rearview mirror, said Flynn. That could all change depending on how the Greek debt crisis develops. Greece’s fate in the eurozone may be set when European leaders meet this weekend.