Crude Oil Ends Higher On China Data

(RTTNews) - U.S. crude oil snapped a two-day loss to end higher Thursday, on renewed demand prospects after some upbeat manufacturing data out of China with the dollar trending lower against a select band of currencies. Nevertheless, the uptick was capped by some soft initial unemployment benefits data from the U.S. and the surge in U.S. crude oil inventories last week.

China's manufacturing growth hit a seven-month high in October, evidencing recovery strengthening in the country after the slowdown in the first half of the year. The flash manufacturing Purchasing Managers' Index rose more-than-expected to 50.9 in October from 50.2 in September, a survey by HSBC and Markit Economics showed.

Light Sweet Crude Oil futures for December delivery, the most actively traded contract, gained $0.25 or 0.3 percent to close at $97.11 a barrel on the New York Mercantile Exchange Thursday.

Crude prices for December delivery scaled a high of $97.69 a barrel intraday and a low of $95.95.

Yesterday, oil settled sharply lower for a second straight session mostly on demand growth concerns after the Energy Information Administration's weekly oil report showed U.S. crude oil stockpiles to have increased much more than expected last week. This is fifth straight week of U.S. crude stockpile increase.

The Energy Information Administration on Wednesday said U.S. crude oil inventories jumped 5.20 million barrels with gasoline stocks down 1.80 million barrels in the week ended October 18. Analysts expected crude oil inventories to gain 1.7 million barrels and gasoline stocks to ease 0.1 million barrels last week.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 79.18 on Thursday, down from 79.28 late Wednesday in North American trade. The dollar scaled a high of 79.32 intraday and a low of 79.08.

The euro traded higher against the dollar at $1.3805 on Thursday, as compared to its previous close of $1.3776 late Wednesday in North America. The euro scaled a high of $1.3825 intraday and a low of $1.3766.

In economic news from the U.S., the Labor Department said initial jobless claims dropped to 350,000 in the week ended October 19, a decrease of 12,000 from the previous week's revised figure of 362,000. Economists expected claims to fall to 340,000 from the 358,000 originally reported for the previous week.

Separately, the U.S. Commerce Department said trade deficit in August ticked up to $38.8 billion from a revised $38.6 billion in July. Economists expected a wider deficit of $40.0 billion from the $39.1 billion originally reported for the previous month. The value of imports were virtually unchanged at $228.0 billion, while the value of exports edged down to $189.2 billion from $189.3 billion.

From the eurozone, Germany's private sector economy expanded at the slowest pace in three months during October, as the slowdown in services growth offset improvement in manufacturing, preliminary data from Markit Economics showed. The flash composite output index dropped to a three-month low of 52.6 from 53.2 in September.

Meanwhile, an indicator of private sector performance in the euro area signaled expansion for the fourth straight month in October, but declined unexpectedly from a 27-month high, survey results showed. Due to a slowdown in services, the flash composite Purchasing Managers' Index dropped unexpectedly to 51.5 from 52.2 in September, Markit Economics said. The reading was expected at 52.4.