Crude oil rose for a third day as optimism the global economy is recovering from recession bolstered hopes of a rebound in fuel demand. Oil has gained 1.9 percent in the past three days.
Crude oil rose for a third day as optimism the global economy is recovering from recession bolstered hopes of a rebound in fuel demand. Oil has gained 1.9 percent in the past three days. The MSCI Asia Pacific Index advanced 0.5 percent, on course for its highest close since Sept. 25. Australia"s central bank governor also said the global economy is improving and there has been a marked pickup in activity in East Asia.
?There"s some "optimism premium" in there, in anticipation of an economic recovery,? said Michael Coleman, managing director of Aisling Analytics in Singapore. ?At some point, high oil prices will kill the economic recovery.?
Crude oil for September delivery rose as much as $1.08, or 1.5 percent, to $71.60 a barrel on the New York Mercantile Exchange, and traded at $70.71 at 3 p.m. in Singapore. Yesterday, the contract gained 0.5 percent to settle at $70.52 a barrel. Futures have advanced 59 percent this year. Oil is set to decline 0.3 percent this week.
Analysts predicted that Hong Kong is poised to emerge from its worst recession since 1990 as exports were bolstered by a recovery in mainland China.
?The feeling is that China"s economy has turned the corner, and there"s a lot of news out of the U.S. that the economy is bottoming out,? said Anthony Nunan, an assistant general manager for risk management at Mitsubishi Corp. in Tokyo. ?We"re getting close to a medium-term high of about $75 a barrel.?
Hong Kong"s gross domestic product probably rose 1.2 percent in the second quarter, snapping a year of declines, according to the median estimate of analysts surveyed by Bloomberg. The Hong Kong government is due to announce figures at 4:30 p.m. today.
The Standard & Poor"s 500 Index added 0.7 percent to 1,012.73, while the Dow Jones Industrial Average increased 0.4 percent, to 9,398.19. The S&P 500 has a correlation of 0.8 with New York oil futures in the past year. A correlation of 1 means the two move in lockstep.
Japan"s Trade Ministry said that the tertiary index, which gauges money spent by households and businesses on phone calls, power and transportation, climbed 0.1 percent in June from May. The median estimate of 20 economists surveyed by Bloomberg was for a 0.3 percent drop.
?Things abroad hardly look rosy, but they look distinctly better than they did a few months ago,? Australia"s Reserve Bank Governor Glenn Stevens said at the half-yearly testimony to parliament"s economics committee in Sydney today.
Brent crude oil for September settlement gained as much as 80 cents, or 1.1 percent, to $74.28 a barrel on London"s ICE Futures Europe exchange. It was at $73.68 a barrel at 1:25 p.m. in Singapore. The September contract expires today.
Gasoline for September delivery rose as much as 2.83 cents, or 1.4 percent, to $2.0475 a gallon in New York, and traded at $2.0320 at 1:15 p.m. Singapore time.
Crude oil futures may fall next week on speculation that U.S. fuel inventories will extend gains, according to a survey of analysts.
Twenty of 40 analysts surveyed by Bloomberg News, or 50 percent, said futures will decline through Aug. 21. Ten respondents, or 25 percent, forecast that the market will rise and 10 said prices will be little changed. Last week, 58 percent of analysts said oil would fall.