.
.
.
Oil falls below $46 a barrel as US stocks tumble
SIOUX FALLS: Oil prices plunged to their lowest levels in more than a month Monday as investors, nervous about a week chock-full of corporate earnings reports, sought safer havens in gold and the dollar.
Benchmark crude for May delivery fell $4.45 to settle at $45.88 a barrel on the New York Mercantile Exchange. With trading on the May contract ending Tuesday, most of the trading has shifted to the June contract. Benchmark crude for June delivery dropped $3.96 to settle at $48.51 a barrel.
Phil Flynn, an analyst at Alaron Trading Corp., said the oil markets are reacting to weakness in the stock markets and strength in the dollar.
"This is a market that is totally dependent on these two markets right now for direction," Flynn said. "We don't move on supply. We don't move on demand. We just move on the dollar."
"And wherever the dollar is or the stock market is, that's where we have a tendency to end up with the oil."
Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates, said it's difficult to build a bullish scenario for the oil markets amid increasing crude supplies.
"Last week we spent much of the week scratching our heads, people wondering why oil was holding about $50 in the face of all of these bearish fundamentals," Ritterbusch said. "This week we can say well, the markets are doing what they're supposed to do, which is discount bad news."
The Dow was down more than 250 points Monday afternoon despite a surprisingly strong profit report from Bank of America Corp., and Oracle Corp.'s announcement that it plans to acquire Sun Microsystems Inc. for $7.4 billion.
Stock markets had jumped more than 20 percent in the last six weeks on expectations that massive global stimulus packages would spark a recovery by the end of the year.
But concerns about the sustainability of bank earnings weighed on financial stocks. Bank of America fell more than 20 percent despite a surprisingly strong profit report, and Citigroup Inc. dropped more than 18 percent.
Halliburton Co. offered a dour outlook Monday as it reported earnings that tumbled 35 percent from a year ago.
The Houston-based company, which helps producers with drilling, reservoir management and other oilfield work, was hurt as oil and natural gas producers cut back on exploration and drilling, particularly in North America.
Halliburton's chairman and chief executive, Dave Lesar, said there are no clear signs when the falloff will bottom out and noted that the current downturn has happened more quickly than past cycles.
Both the oil and stock markets are due for a reality check this week _ among the hundreds of companies due to report are 3M Co., Boeing Co., Coca-Cola Co., DuPont, IBM Corp., McDonald's Corp., Merck & Co. and Microsoft Corp.
Source: TOI
.
.
Oil falls below $46 a barrel as US stocks tumble
SIOUX FALLS: Oil prices plunged to their lowest levels in more than a month Monday as investors, nervous about a week chock-full of corporate earnings reports, sought safer havens in gold and the dollar.
Benchmark crude for May delivery fell $4.45 to settle at $45.88 a barrel on the New York Mercantile Exchange. With trading on the May contract ending Tuesday, most of the trading has shifted to the June contract. Benchmark crude for June delivery dropped $3.96 to settle at $48.51 a barrel.
Phil Flynn, an analyst at Alaron Trading Corp., said the oil markets are reacting to weakness in the stock markets and strength in the dollar.
"This is a market that is totally dependent on these two markets right now for direction," Flynn said. "We don't move on supply. We don't move on demand. We just move on the dollar."
"And wherever the dollar is or the stock market is, that's where we have a tendency to end up with the oil."
Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates, said it's difficult to build a bullish scenario for the oil markets amid increasing crude supplies.
"Last week we spent much of the week scratching our heads, people wondering why oil was holding about $50 in the face of all of these bearish fundamentals," Ritterbusch said. "This week we can say well, the markets are doing what they're supposed to do, which is discount bad news."
The Dow was down more than 250 points Monday afternoon despite a surprisingly strong profit report from Bank of America Corp., and Oracle Corp.'s announcement that it plans to acquire Sun Microsystems Inc. for $7.4 billion.
Stock markets had jumped more than 20 percent in the last six weeks on expectations that massive global stimulus packages would spark a recovery by the end of the year.
But concerns about the sustainability of bank earnings weighed on financial stocks. Bank of America fell more than 20 percent despite a surprisingly strong profit report, and Citigroup Inc. dropped more than 18 percent.
Halliburton Co. offered a dour outlook Monday as it reported earnings that tumbled 35 percent from a year ago.
The Houston-based company, which helps producers with drilling, reservoir management and other oilfield work, was hurt as oil and natural gas producers cut back on exploration and drilling, particularly in North America.
Halliburton's chairman and chief executive, Dave Lesar, said there are no clear signs when the falloff will bottom out and noted that the current downturn has happened more quickly than past cycles.
Both the oil and stock markets are due for a reality check this week _ among the hundreds of companies due to report are 3M Co., Boeing Co., Coca-Cola Co., DuPont, IBM Corp., McDonald's Corp., Merck & Co. and Microsoft Corp.
Source: TOI
No comments:
Post a Comment