Aust dollar slumps below US70c

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The Australian dollar is weaker against the US dollar, as the resumed fall in oil and base metal prices weighs.

At 7.25am (AEDT), the local unit was trading at US69.65c, down from US70.17c on Friday.

Oil prices fell more than 5 per cent on concerns of oversupply after news that Iraq’s output reached a record in December.

Source: businessspectator

Oil Drops as Saudis to Maintain Spending, China Diesel Use Falls

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Oil dropped after Saudi Arabia, the world’s biggest crude exporter, said low prices won’t reduce its spending on energy projects and China’s diesel demand fell for a fourth consecutive month.

Futures tumbled 5.8 percent in New York. Saudi Arabian Oil Co., also known as Saudi Aramco, is maintaining its investment plans despite the rout in the crude market, Chairman Khalid Al-Falih said Monday. Diesel use in China dropped 5.6 percent in December compared with a year earlier and gasoline consumption grew at the slowest pace in more than two years.

Oil resumed its decline after the biggest two-day rally in more than seven years as concerns persist over ample U.S. stockpiles, steady production from Saudi Arabia and Russia and the outlook for increasing Iranian shipments after the end of sanctions. Prices may take as long as three years to normalize, according to Bank of Montreal Chief Executive Officer William Downe.

West Texas Intermediate for March delivery dropped $1.85 to close at $30.34 a barrel on the New York Mercantile Exchange. Total volume traded was 28 percent higher than the 100-day averageat 2:57 p.m. Front-month prices rose 21 percent over two sessions at the close Friday after the February contract expired Wednesday at $26.55 a barrel, the lowest since 2003.

Brent for March settlement fell $1.68, or 5.2 percent, to end the session at $30.50 a barrel on the London-based ICE Futures Europe exchange. The contract gained 10 percent to $32.18 Friday. The European benchmark crude closed at a 16-cent premium to WTI.

Source: Bloomberg

U.S. Stocks Fall With Energy Shares Leading as Oil Resumes Slide

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U.S. stocks fell, with declines accelerating in the final hour after crude oil extended its selloff, as equities lost momentum following their first weekly advance this year.

The Standard & Poor’s 500 Index declined 1.6 percent to 1,877.34 at 4 p.m. in New York, erasing three-quarters of a rally Friday that saw the gauge cap the best back-to-back gains in three months. Energy shares in the benchmark fell the most since August.

Equities are on track for their worst January since 2009 amid worries that China’s slowdown will weigh on global growth, with plunging oil prices exacerbating those concerns. The S&P 500 sank to a 21-month low last week, and it’s down 8.2 percent this month.

Stocks rose last week, with energy shares helped by a rebound in crude, on bets central banks around the world will act to support the global economy, even as the Federal Reserve tightens policy. European Central Bank President Mario Draghi said today the ECB must fulfill its inflation mandate in order to maintain its credibility. With slumping oil costs weighing on consumer prices that are already close to stagnating, Draghi is trying to convince investors that the central bank remains willing to act if needed.

Source : Bloomberg

U.S. Stocks Decline as Crude Slump Worsens; Bonds, Gold Advance

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U.S. stocks halted a two-day rally as renewed declines in the price of crude set the tone on global financial markets, dragging down currencies of resource exporters and stoking demand for havens from gold to Treasuries.

The Standard & Poor’s 500 Index followed European shares lower after American crude’s slide approached 5 percent, undoing part of a 21 percent surge in oil to end last week. Emerging-market shares headed for the biggest two-day gain since August on bets that central banks will step up stimulus. Yields on 10-year Treasury notes fell three basis points 2.02 percent. The Russian ruble slid against all of its 31 major counterparts, while gold futures jumped 1 percent.

The S&P 500 fell 0.6 percent at 12:30 p.m. in New York, after a 2 percent rally on Friday. Equities are on track for their worst January since 2009 amid worries that China’s slowdown will weigh on global growth, with plunging oil prices exacerbating those concerns. The S&P 500 sank to a 21-month low last week before rallying.

Halliburton Co. declined Monday after posting a quarterly loss, and Exxon Mobil Corp. slide following crude’s biggest two-day rally in more than seven years. McDonald’s Corp. gained after the fast-food giant’s earnings beat analysts’ forecasts. Tyco International Plc surged 8.6 percent after Johnson Controls Inc. agreed to merge with the company.

Source : Bloomberg

European Stocks Halt Rebound as Banks, Commodity Producers Slide

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Declines in commodity shares and lenders put an end to a rally in European stocks.

The Stoxx Europe 600 Index fell 0.6 percent at the close of trading in London. Seadrill Ltd. led the slide, tumbling 8.9 percent as oil fell after the world’s biggest crude exporter said it’s keeping up investments in energy projects. A gauge of miners also dropped, while lenders slid the most among industry groups.

The rout in commodity prices is once again weighing on risk assets amid concern that China’s slowdown will hurt global growth. After reaching the cheapest valuation in about two years on Wednesday, the Stoxx 600 enjoyed its biggest two-day surge since 2011 on speculation of more stimulus. European Central Bank President Mario Draghi signaled measures could come as soon as March.

Among shares active on corporate news, Kingfisher Plc sank 6.1 percent after Europe’s largest home-improvement retailer said that short-term earnings will suffer from a five-year plan to boost profit.

Source: Bloomberg