Forexpros – Crude oil futures erased losses in U.S. morning trade on Tuesday, after better-than-expected U.S. manufacturing data but a broadly stronger greenback meant that gains in the dollar priced commodity were limited.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in June traded at USD105.16 a barrel, rising 0.27%, up from a session low of USD104.4.
The Institute for Supply Management said its index of manufacturing activity rose to 54.8 from 53.4 in March, defying expectations for a decline to 53.0.
The report said new orders climbed to 58.2 from 54.5, while the employment index also rose to 57.3 from 56.1.
The data eased concerns over the outlook for the U.S. economic recovery after Monday’s weaker-than-expected Midwest manufacturing report and U.S. consumer spending data dented sentiment on the greenback.
Oil prices were largely unchanged earlier after official data showed that an index of Chinese manufacturing activity rose to a 13-month high of 53.3 in April from 53.1 the previous month, but the data came in slightly below forecasts for a reading of 53.6.
The reaction to the data was somewhat subdued with many markets in Asia including China, Hong Kong, India and Singapore, as well as in Europe closed for national holidays.
Also Tuesday, the Reserve Bank of Australia surprised markets with a larger-than-expected interest rate cut to 3.75%, its lowest level since early 2010, in an attempt to boost the nation’s commodity-linked economy.
Market participants were shifting their focus to U.S. monthly jobs figures for April, to be released Friday after data in March showed a slowdown in hiring in the world’s largest oil consumer.
On the ICE Futures Exchange, Brent oil futures for June delivery slipped 0.13% to trade at USD119.31 a barrel, still up USD14.17 from its U.S. counterpart.
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