|Analysis||Oil inclined slightly today after the release of upbeat U.S. data yesterday and ahead of important labor report today.|
Prices slipped on Thursday despite the optimistic U.S. data which showed that jobless claims plunged to 10-month low, providing evidence that labor market conditions are improving. Later on today, non-farm-payrolls report will be released with expectations to show progress, but still the rate of unemployment is high and is anticipated to surge to 9.9%, the highest in 26 years.
Recently, the series of buoyant data managed to give an impetus to crude prices raising it again above $80 a barrel. World economies showed remarkable signs of recovery, especially in the third quarter which suggested better future demand on energy products.
Currently, central banks are looking forward to withdrawing the stimulus measures and adopting tightening monetary tools in the coming period. The ECB a day ago warned from the upside risks of stimulus measures and recommended stopping them soon, while the BoE raised their asset purchase facility program with 25 billion pounds only, where markets were expecting 50 billion pounds rise.
Equity markets, on the other hand, pared some of the losses this week as U.S. stocks succeeded in closing above 10,000 points for the first time since October 22. Dow Jones gained 203.82 points or 2.08% to 10005.96 points; S&P 500 advanced 20.13 points or 1.92% to 1066.63 points; and NASDAQ picked up 49.80 points or 2.42% to 2105.32 points. In Asia, the MSCI Asia Pacific index rose today and Nikkei index closed on 0.74% rise.
In currency markets, the U.S. dollar slipped for the third day on Friday as indicated by the dollar index which tracks the dollar movements against a basket of major currencies. The index slumped to 75.66 compared with the day's opening at 75.71. Oil benefited from the dollar's fall and inclined close to its highest level in a year.
However, prices are facing resistance at $80 which if breached may lift prices higher. Meanwhile, oil is traded at $80.00 recording a high of $80.15 and a low of $79.65, whereas the contract a day ago edged down $0.78 closing at $79.62, while recording a high of $80.52 per barrel and a low of $79.34 per barrel.