Commodities Are Mixed in the Early Hours on September 1

Pre-Market Report: Strong Global Markets and Mixed Commodities PART 3 OF 3

Crude oil

Commodities are mixed early on September 1. Following a four-week losing streak, crude oil started this week on a weaker note. It fell in the first three trading days of the week. However, crude oil regained its strength on Thursday. After a brief recovery, crude oil opened lower on Friday and traded with weakness in the early hours.

Commodities Are Mixed in the Early Hours on September 1

Market sentiment

The market sentiment is weak amid demand concerns in the US due to Hurricane Harvey. Floods damaged crude oil refinery facilities located in the Gulf Coast region. The damage stalled almost 25% of the US refinery capacity. According to reports from refinery companies in the region and Reuters estimates, almost 4.4 million barrels per day of refinery capacity has been shut down due to Hurricane Harvey. Generally, any interruption to the refining capacity is considered a positive for crude oil price movements given the market’s oversupply situation. Refinery damage raised concerns about demand and weighed on oil prices. The larger-than-expected fall in the inventory didn’t add buying pressure to crude oil. The market is looking forward to the release of Baker Hughes’s US oil rig count data at 1:00 PM EST today.

At 7:25 AM EST on September 1, the West Texas Intermediate crude oil futures contracts for October 2017 delivery were trading at $46.91 per barrel—a fall of ~0.68%. The Brent crude oil futures contracts for November 2017 delivery fell 0.53% and traded at $52.59 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $30.16 after rising 1.8% on August 31.

Metals

After resuming its upward movement on Thursday, copper started Friday on a stronger note. Amid the strong global manufacturing PMI numbers, copper is trading with strength in the early hours at fresh three-year high price levels. Copper’s stronger outlook in the coming months and supporting manufacturing data pushed copper higher this week. Gold (GLD) and silver (SLW) are strong in the early hours on Friday ahead of the US non-farm payrolls data. Platinum and palladium are stable in the early hours on Friday.

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