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U.S. oil prices extend gains on slide in dollar, talk of oil producer meeting

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Business | Thu Feb 4, 2016 6:18am IST


SINGAPORE U.S. crude oil prices extended gains from the previous session on Thursday, as a weaker dollar and ongoing yet unconfirmed talk of producers potentially meeting to discuss output cuts lifted the market despite record U.S. stocks.

U.S. West Texas Intermediate (WTI) CLc1 crude futures were trading at $32.39 per barrel at 0031 GMT on Thursday, up 11 cents from the previous session’s close when they rallied 8 percent from below $30 per barrel.

Analysts said that prices had recovered support from a sliding dollar, as well as from ongoing yet unconfirmed talk of a potential meeting by major oil producers to cut output in support of prices, which have fallen around 70 percent since mid-2014.

But the main feature of oil trading in the past few weeks has been volatility, with prices lashing out up and down, with over 10 percent price swings within two trading sessions frequently occurring since mid-January.

“The weaker U.S. dollar provided some interim support to the commodity complex, but volatility in crude oil remains extreme. Climbing U.S. crude stocks remain an ongoing threat to further price weakness,” ANZ bank said.

U.S. crude inventories USOILC=ECI climbed 7.8 million barrels in the week to Jan. 29 to 502.7 million barrels, compared with analyst expectations for an increase of 4.8 million barrels, as imports jumped and refiners trimmed throughput.

U.S. gasoline inventories USOILG=ECI also rose to a record high, soaring 5.9 million barrels to 254.4 million barrels. Analysts had forecast a 1.7 million-barrel gain in gasoline inventories.

(Reporting by Henning Gloystein; Editing by Joseph Radford)

Source: R-Business


Toshiba may deepen full-year loss forecast as restructuring costs mount

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TOKYO Toshiba Corp (6502.T) said on Thursday it is examining whether to deepen its full-year loss forecast when it reports quarterly earnings later in the day, amid mounting restructuring costs after an accounting scandal.

Kyodo News and The Nikkei reported that the industrial electronics conglomerate will downgrade its net loss projection to over 600 billion yen ($5.1 billion), from the 550 billion yen currently foreseen, for the year ending March 31.

Toshiba said in a statement that the reports were not based on any company announcements and it would release its earnings at 0600 GMT.

(Reporting by Chris Gallagher; Editing by Stephen Coates)

Source: R-Business


Dollar under pressure as Fed's Dudley cools rate-hike views

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TOKYO The dollar nursed hefty losses against the yen and euro on Thursday after tumbling overnight when a top Federal Reserve official tempered expectations on the pace of future U.S. interest rate increases.

The dollar was steady at 117.97 yen JPY= after dropping 1.7 percent overnight. The greenback handed back all the gains made against its Japanese counterpart after the Bank of Japan adopted negative interest rates late last week, pushing it as high as 121.70.

The U.S. currency took a beating on Wednesday after William Dudley, president of the Federal Reserve Bank of New York, said financial conditions are considerably tighter and a weakening outlook for the global economy would have to be taken into account.

The dollar was weighed down by a survey from the Institute of Supply Management (ISM) showing activity in the vast U.S. services sector slowed to a near two-year low in January, adding another layer of uncertainty on the Fed’s near-term policy path.

The euro traded at $1.1054, hovering near a 3-1/2-month high of $1.1145 EUR= scaled overnight. The single currency rallied 1.7 percent against the dollar after U.S. Treasury yields slipped to 10-month lows in the wake of the Dudley comments and downbeat data.

The market focus will now shift to U.S. factory orders data, and comments by Cleveland Fed President Loretta Mester and Boston Fed President Eric Rosengren later in the session.

“The dollar may rebound as it could have overreacted to the ISM non-manufacturing numbers. But it could still fall below 117 yen on fresh dovish comments from Fed officials,” said Masafumi Yamamoto, chief FX strategist at Mizuho Securities in Tokyo.

“Of the Fed officials due to speak today, focus will be on whether Mester turns dovish.”

Mester had told Reuters in an interview early last month that she prefers a slightly quicker rate hike pace.

Commodity-linked currencies held to their gains made on Wednesday on a sharp rebound in crude oil prices and the dollar’s broad retreat.

The Canadian dollar hovered near a 7-week high of C$1.3757 CAD=D4 to the dollar struck on Wednesday. The rally helped reverse weakness seen earlier in the year, when the loonie slumped to a 13-year trough of C$1.4689 amid a tumble in crude oil.

The Australian dollar was down 0.2 percent at $0.7155 AUD=D4, pulling back a little from a 1-month high of $0.7189 reached overnight.

(Editing by Shri Navaratnam)

Source: R-Business

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