Oil Extends Decline as U.S. Crude Supplies Seen Expanding Glut

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Oil extended declines for a third day before U.S. government data forecast to show increasing crude stockpiles kept supplies at the highest level in more than eight decades.

Futures slid as much as 1.2 percent in New York after falling 3 percent Monday. Inventories rose by 2.85 million barrels last week, according to a Bloomberg survey before an Energy Information Administration report Wednesday. Oil-producing countries are discussing a draft resolution for the Doha meeting on freezing output, Russian Energy Minister Alexander Novak told reporters.

West Texas Intermediate for May delivery dropped as much as 43 cents to $35.27 a barrel on the New York Mercantile Exchange and was at $35.31 at 8:39 a.m. Hong Kong time. The contract fell $1.09 to $35.70 on Monday, the lowest close since March 3. Total volume traded was about 47 percent below the 100-day average.

Source: Bloomberg

Aussie Falls Second Day on Prospects RBA to Say Rally a Concern

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Australia’s dollar weakened for a second day on speculation Governor Glenn Stevens will signal at a policy meeting that the currency’s recent advance is a concern.

The Aussie dropped against 12 of its 16 major peers on Tuesday after surging 13 percent from a seven-year low set in January to a nine-month high last week. Commonwealth Bank of Australia, the nation’s largest lender, estimates the currency is now strong enough to be of concern to the central bank after becoming the most overvalued since 2014. Policy makers will leave their benchmark interest rate at 2 percent, according to all of the economists surveyed by Bloomberg.

The Australian dollar slipped 0.2 percent to 75.89 U.S. cents as of 9:54 a.m. in Sydney after dropping 0.9 percent on Monday. The currency appreciated to 77.23 cents on March 31, the strongest level since July 1.

Source: Bloomberg

Asian Stocks Decline as Oil Slides, Japan Shares Slump on Yen

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Asian stocks dropped as energy producers fell with crude oil and Japanese exporters slipped as the yen traded near an 18-month high.

The MSCI Asia Pacific Index fell 0.3 percent to 126.12 as of 9:02 a.m. in Tokyo. Japan’s Topix index lost 0.6 percent as the yen held below 111.50 per dollar following a two-day advance. The Federal Reserve’s commitment to a gradual approach to raising interest rates has steadied markets, with global equities rallying from a 2 1/2-year low reached mid-February as central banks around the world work to restore confidence. Oil’s rebound may have faltered, with anxiety over the potential disintegration of a Saudi-Russia led pact to freeze output driving crude’s more than 7 percent slide over the past three sessions.

South Korea’s Kospi index declined 0.3 percent. New Zealand’s S&P/NZX 50 Index increased 0.1 percent. Australia’s S&P/ASX 200 Index slid 0.1 percent. Markets in mainland China and Hong Kong will resume trading following Monday’s holiday.

Source: Bloomberg

Japan Stocks Fall as Yen Near 18-Month High Weighs on Exporters

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Japan’s Topix index fell for the fifth time in six days as a stronger yen weighed on the earnings outlook for exporters, while cheaper oil dragged energy shares lower.

The Topix declined 0.4 percent to 1,297.38 as of 9:01 a.m. in Tokyo as all but five of its 33 industry groups fell. The Nikkei 225 Stock Average lost 0.4 percent to 16,063.02, falling for a sixth day and headed for its lowest close since Feb. 29. The yen strengthened for a third day, trading at 111.26 per dollar, near its strongest level in almost 18 months. Oil extended losses after dropping to a one-month low amid doubts about the prospects of a proposed deal to freeze supply.

Source: Bloomberg

U.S. Stocks Rally Loses Momentum After Reaching Highs for Year

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U.S. stocks slipped from their highest levels this year, with declines in consumer and industrial shares overshadowing gains in health-care companies, as investors looked for fresh reasons to continue a rally.

The Standard & Poor’s 500 Index dropped 0.3 percent to 2,066.05 at 4 p.m. in New York, the biggest slide in more than a week while a measure of investor anxiety rose from the lowest level since August.

The main U.S. equity benchmark retreated after extending 2016 gains on Friday, an advance that came amid reports showing the pace of job creation remained robust and manufacturing activity improved. That bolstered confidence in the economy, while central banks have signaled they will continue their efforts to support growth.

Following Fed Chair Janet Yellen’s reassurance last week that the pace of future rate increases will be gradual, traders are pricing in zero possibility of a hike at the end of April, with December now the first month with at least even odds of higher borrowing costs. A report today showed a measure of factory orders declined in February, suggesting business investment will be a drag on growth again in the first quarter. Minutes from the Fed’s meeting last month are due for release on Wednesday.

Attention will begin shift more toward corporate earnings, with Alcoa Inc. unofficially kicking off the reporting season when it releases first-quarter results on April 11. Analysts estimate profit at S&P 500 firms fell 9.5 percent during the period, compared with forecasts for flat earnings growth at the beginning of the year. The S&P 500 now trades at its highest valuation since July, based on 12-month projected earnings.

Source: Bloomberg