Crude oil price rebounds to 67.8 after declining for 2 consecutive days. Recovery in stock markets and weakness in dollar do help push commodity prices higher. After market close, the industry-sponsored American Petroleum Institute (API) will report oil inventory last week and this should allow investors to gauge the demand/supply condition.
Economic data released in Europe lifted market sentiment. In the UK, headline CPI rose +1.8% yoy in July, higher than consensus of +1.5%. In June, the annual growth was also +1.8%. Excluding food and energy prices, the core inflation also grew +1.8% after rising +1.6% in June. Analysts had anticipated a slowdown to +1.5%.
Investors' confidence in the Eurozone improved strongly in August. According to ZEW Center for Economic Research, the sentiment index for the 16-nation region rose to 54.9 in August, compared with market expectation of 43, from 39.5 in the previous month. The sentiment index in Germany surged to 56.1, also higher than consensus of 43, from 39.5 in July.
Stocks in Europe rose after the encouraging data. UK's FTSE 100 Index opens higher and is currently trading +0.8% above yesterday's close. Germany's DAX and France's CAC 40 also gained +0.5% and +0.6% to 5228 and 3439, respectively.
The next focus of the day will be US' housing starts and building permits. The market anticipated housing starts have risen to 598K in July from 582K in the previous month as driven by growth in single-family housing starts. Moreover, multi-family starts should also have shown modest gain in July, following a drop of -27% mom in June.
Gold price recovers to 940 in European morning as USD retreats. Against the euro, the greenback drops -0.4% to 1.41 after better-than-expected ZEW sentiment readings. Silver price also regains the 14-level after plunging almost -7% over the past 2 days.
PGMs should benefit from the government's 'cash for clunkers' program though the impact may not been significant in the near-term. News said that General Motors may announce production plans later this week. It's also heard that GM has added shifts in order to meet increased demand for vehicles.