Europe Lower After Oil Price Hike

Ivaylo
07 Aug, 2006
Frankfurt

Weaker-than-expected jobs growth in the US weighed also as the focus turned from expectations the Federal Reserve would pause its monetary tightening to worries over slowing growth. The FTSE 100 declined 1%, the Xetra Dax in Frankfurt slipped 1.5% and the CAC-40 in Paris was off 1.5%.

[R]6:15AM European markets were lower in morning trade due to oil prices rise.[/R]
European markets traded lower in morning sessions on Monday. The FTSE 100 declined 1% at 5,832.1, the Xetra Dax in Frankfurt slipped 1.5% to 5,635.12 and the CAC-40 in Paris was off 1.5% to 4,962.57. BP’s Alaskan closure cut output down by 400,000 barrels a day, 8% of US production, and pushed the price of crude oil back up above $76 a barrel. But despite the surging oil price, the sector was weaker. BP fell 1.8%.

Other oil producers also fell. OMV of Austria shed 0.8% and ENI of Italy sank 0.6%, Statoil of Norway bucked the downward trend gaining 0.6% as well as Neste Oil of Finland adding 0.3%. Low-cost airline EasyJet announced full-year revenues and costs would be slightly higher than expected but maintained its guidance for a 40-50 per cent rise in annual earnings. The company fell 1.2%.

Among insurance companies, Swiss Re was reported to be considering a bid for Scottish Widows, the insurance arm of Lloyds TSB. Swiss Re said it had no comment on the report. Lloyds TSB also declined to comment. LTSB fell 0.8% and Swiss Re shed 0.8%.

Light, sweet crude oil for September delivery was up $1.23 to $75.99 a barrel, while gold dealers in London fixed a recommended price of $647.25 bid per troy ounce at midmorning, down from $648.50 on Friday. The U.S. dollar was higher against most other major currencies in European trading Monday. The euro was quoted at $1.2856, down from $1.2875 late Friday in New York. The British pound bought $1.9058, down from $1.9082, while the greenback purchased 114.94 Japanese yen, up from 114.39.

[R]5:00AM Gold fell Friday due to profit-taking and weaker U.S. economic data.[/R]
December gold finished down $1 at $656 an ounce. Silver managed to hold its gains better than gold in spite of easing from an 8-week high of $12.65 an ounce reached during the session. September silver closed at $12.485, up 39.5 cents. October platinum ended up $9.50 at $1,256 an ounce after hitting a session high of $1,258 an ounce. September palladium ended up $2.85 at $327.50 an ounce. Speculation that the Federal Reserve may pause its interest rate hike program next week gave copper a boost to a fresh 2-week high. September copper settled up 14.30 cents at $3.6325 per pound.

September crude oil finished down 70 cents at $74.76 a barrel after falling to $74.15 per barrel earlier. The September gasoline contract settled down 6.19 cents to $2.2315 a gallon. September natural gas ended down 4.6 cents at $7.246 a million British thermal units. On the New York Board of Trade, September Arabica coffee futures ended 0.40 cent lower at $1.0545 a pound. October futures for raw sugar in foreign ports finished up 0.13 cent at 14.41 cents a pound.