Crude oil price continues to trade with a soft tone around 71 level in European morning as it lacks supports from stock markets and USD strengthens further. Nigerian militants said over the weekend that they had sabotaged a pipeline run by Chevron in the Southern Niger Delta region may give some support to oil price.
Sentiment on the dollar gets stronger after Russia's finance minister said he is confident about USD. At an interview over the weekend, Kudrin said that 'USD is in 'good shape' and 'it's too early to speak of an alternative to dollar'. The speech eased investors concerns about USD to be replaced as the dominant reserve currency any time soon.
The greenback surges 1.1% to 1.385 against the euro in European morning. Against Canadian dollar, USD also rises to 1.13, the highest level in 2 week. Discussions on plans to reduce budget deficits in the G-8 meeting also supports USD's movement as it's one of the very serious matter faced by the US after the government employed massive quantitative easing measures as well as other stimulus plans since late 2008.
Stock markets in Asia dropped as led by Taiwan's Taiex Index which plunged -3.5%. Since the beginning of the year, Taiwan shares have surged more than +30% amid speculations that recovery in China will benefit Taiwan. In Australia, S&P/ASX 200 Index slid -0.8% while Singapore Straits Time Index slipped -2.3%. Overall, the MSCI Asia Pacific Index plunged -1.4%.
European shares open lower in morning session. UK's FTSE 100 Index drops -1.7% to 4366 after the Confederation of British Industry said that the UK economy will not start recovery until 2010 and the BOE may need to expand the asset purchase program through 'printing money' so as to stimulate growth.
Employment in the Eurozone fell -0.8% qoq in 1Q09, meaning 1.22M jobs were slashed during the period as companies reduced expenditure so as to weather the worst recession since WWII. While signs of recovery have emerged, job market is expected to remain bleak in coming months as corporations will likely continue reducing headcounts in 2H09 as well as in 2010. Germany's DAX Index loses 2.1% while France's CAC 40 Index drops 1.7% after the report.
Gold price retreats to 933 while silver slips further to 14.33 as weighed on by USD. Abated expectation on inflation in the near- term has also diminished appeals for precious metals. Moreover, jewelry demand remains weak as poor economy dampened purchase.