Oil Begins Week On Flat Note

Oil......

Crude oil futures

began the new week on flat note getting some lift from sharp rally in the Asian equities on back the Bank of Japan report that the nation's economy was slowly improving.

Stocks in Hong Kong and Japan jumped to lead Asian markets higher Monday, tracking a positive global lead after key U.S. indexes notched another record finish on Friday, although South Korean shares underperformed amid geopolitical concerns.

The Bank of Japan said in its May report issued Monday that the nation's economy was slowly improving, marking an upgrade from its views in the April update, according to reports. Japanese stocks traded solidly higher Monday, also helped by Friday's gains on Wall Street, with the Nikkei Stock Average up 1.5% in early afternoon action.

Light sweet crude futures for delivery in July are trading down 6 cents at $ 95.96 on the New York Mercantile Exchange. It rose 1.2% Friday to settle the week at $96.29 a barrel by close of trade. On the week, Nymex oil futures added 0.75%, the fourth consecutive weekly advance.

New York-traded crude oil futures ended Friday’s session at a one-week high, after data showed that U.S. consumer sentiment rose more than expected in May, climbing to an almost six year high. Oil prices drew further support from rising U.S. equities markets, with the S&P 500 index closing at a fresh record high on Wall Street.

U.S. shares and crude oil have traded in tandem in recent weeks, on the belief share prices act as a proxy for economic sentiment and are a bellwether for oil demand.

Gains were limited as the dollar index, which tracks the performance of the greenback against a basket of six other major currencies, rose 0.5% on Friday to settle the week at 84.34, the strongest level since July 2010.

MCX May crude oil futures may open today’s session near Rs 5300 levels with resistance near Rs 5330 and support near Rs 5270 levels.

In the week ahead, oil traders will be focusing on Wednesday’s Federal Reserve minutes, as well as testimony on the economic outlook and monetary policy by Fed Chairman Ben Bernanke.

Markets will also be awaiting the release of key euro zone data on manufacturing and service sector activity.

Source by Commodity Insights