Crude falls on profit taking after investors digest U.S. data
Published Aug 16, 2013 01:56PM ET
On the New York Mercantile Exchange, light sweet crude futures for delivery in September traded at USD106.99 a barrel during U.S. trading, down 0.32%.
The September contract settled up 0.45% at USD107.33 a barrel on Thursday.
Prices rose in wake of bloody clashes between supporters of Egypt's ousted President Mohamed Morsi and Egyptian security forces, which stoked fears that tensions may spread and involve the country's oil-rich neighbors or disrupt the flow of crude through the Suez Canal.
Profit taking kicked in as mixed indicators failed to sway investors' confidence that the Federal Reserve remains on course to begin scaling back stimulus measures later this year.
The Commerce Department reported earlier that U.S. building permits rose 2.7% to 943,000 units in July, just shy of expectations for a 2.9% increase to 945,000 units although June's figure was revised up to 918,000 units from 911,000.
The government added that housing starts rose 5.9% to 896,000 units in July, missing expectations for a 8.3% increase to 900,000 units. Still, June's figure was revised up to 846,000 units from 836,000.
Elsewhere, the Thomson Reuters/University of Michigan's preliminary consumer sentiment index fell to 80.0 in August from 85.1 in July. Analysts were expecting the index to rise to 85.5 this month.
Not all U.S. data missed expectations.
The Bureau of Labor Statistics said in a preliminary report that nonfarm productivity rose 0.9% in the second quarter, beating expectations for a 0.6% gain after a 1.7% decline in the previous quarter.
The day's data, while mixed, still painted a picture of an economy that is improving and will soon no longer require support from Federal Reserve stimulus measures.
Fed stimulus tools such as the U.S. central bank's USD85 billion in monthly asset purchases weaken the greenback by driving down long-term interest rates, and a weaker dollar makes oil a nicely priced commodity.
Meanwhile on the ICE Futures Exchange, Brent oil futures for September delivery were up 0.10% at USD109.72 a barrel, up USD2.73 from its U.S. counterpart.
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Written By: Investing.com
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