Natural gas futures turn lower after U.S. supply data, hit 3-week low

        Natural gas futures erased gains to hit a three-week low during U.S. morning hours on Thursday, after a report from the U.S. Energy Information Administration showed natural gas supplies fell broadly in line with market expectations last week.

On the New York Mercantile Exchange, natural gas futures for delivery in May traded at USD3.888 per million British thermal units during U.S. morning trade, down 0.3% on the day.     

Prices rose by as much as 1.1% earlier in the day to hit a session high of USD3.966 per million British thermal units.

The May contract traded at USD3.942 prior to the release of the U.S. Energy Information Administration report.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ended March 29 fell by 94 billion cubic feet, compared to expectations for a drop of 91 billion cubic feet.

Inventories increased by 43 billion cubic feet in the same week a year earlier, while the five-year average change for the week is a build of 4 billion cubic feet.

Total U.S. natural gas storage stood at 1.687 trillion cubic feet as of last week. Stocks were 779 billion cubic feet less than last year at this time and 37 billion cubic feet below the five-year average of 1.724 trillion cubic feet for this time of year.

The report showed that in the East Region, stocks were 76 billion cubic feet below the five-year average, following net withdrawals of 48 billion cubic feet.

Stocks in the Producing Region were 29 billion cubic feet below the five-year average of 724 billion cubic feet after a net withdrawal of 42 billion cubic feet.

Natural gas prices were higher earlier despite weather forecasts pointing to mild temperatures in the key Northeast and Midwest markets in the next six-to-10-days.

Natural-gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting forecasts for late-winter heating demand and early-spring cooling needs.

The heating season from November through March is the peak demand period for U.S. gas consumption. Nearly 50% of all U.S. households use gas for heating.

Nymex gas prices rose to USD4.118 per million British thermal units on March 28, the strongest level since September 1, 2011, boosted by calls for colder temperatures in major consuming regions across the U.S.

But with spring's low-demand shoulder season looming, further gains may be limited.

Gas use typically hits a seasonal low with spring's mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning.

The National Oceanic and Atmospheric Administration in its one-month temperature forecast released Sunday called for above-normal temperatures across large swaths of the U.S. in April.

Elsewhere on the NYMEX, light sweet crude oil futures for delivery in May fell 1.4% to trade at USD93.13 a barrel, while heating oil for May delivery dropped 1.4% to trade at USD2.959 per gallon.

Courtesy : Investing.com

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Gold pares losses after Draghi comments, dismal U.S. jobless claims

           Gold futures pared losses during U.S. morning hours on Thursday, bouncing off the lowest levels of the session following comments from European Central Bank President Mario Draghi and after data showed U.S. jobless claims hit a four-month high last week.

But gold prices struggled for upside traction due to a slightly stronger U.S. dollar, as dollar-priced commodities become more expensive to investors holding other currencies when the greenback gains.

The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was up 0.85% to trade at 83.58, the strongest level since August.

On the Comex division of the New York Mercantile Exchange, gold futures for June delivery traded at USD1,549.45 a troy ounce during U.S. morning trade, down 0.25% on the day.

Comex gold prices fell by as much as 0.9% earlier in the session to hit a daily low of USD1,539.85 a troy ounce the weakest level since May 30, 2012.

Gold prices were likely to find support at USD1,532.75 a troy ounce, the low from May 30 and resistance at USD1,604.25, the high from April 2.

Speaking at the ECB’s post-policy meeting press conference, Draghi said that monetary policy will remain "accommodative" for as long as needed.

Draghi’s comments came after the ECB left rates on hold at a record low 0.75% earlier, in a widely anticipated decision.

Gold prices bounced off the lowest levels of the session after the U.S. Department of Labor said the number of individuals filing for initial jobless benefits rose by 28,000 to a four-month high of 385,000 last week, confounding expectations for a decrease of 7,000 to 350,000.

Market players now looked ahead to Friday’s highly-anticipated U.S. monthly jobs report to further asses the strength of the country’s economy and the need for further stimulus from the Federal Reserve.

Any improvement in the U.S. economy could scale back expectations for additional easing by the Fed, boosting the U.S. dollar and weighing on dollar-denominated commodities.

Moves in the gold price this year have largely tracked shifting expectations as to whether the U.S. central bank would end its bond-buying program sooner-than-expected.

Gold prices were also supported after the Bank of Japan announced that it was launching an aggressive easing program in order to achieve its 2% inflation target.

At the end of a two-day meeting, the central bank said it would double the money supply through purchases of government bonds and other measures.

Expectations of monetary stimulus tend to benefit gold, as the metal is seen as a safe store of value and inflation hedge.
Gold futures have fallen more than 3% this week as a bout of technical selling kicked in after prices broke below key support levels earlier in the week, triggering fresh sell orders amid bearish chart signals.

Gold could see further losses in the near-term, with market analysts warning of a possible move towards the USD1,530-level.

Elsewhere on the Comex, silver for May delivery shed 0.15% to trade at USD26.75 a troy ounce. Comex silver fell by as much 0.5% earlier in the session to hit a low of USD26.58 a troy ounce, the weakest level since July 24.

Meanwhile, copper for May delivery fell 0.1% to trade at a nine-month low of USD3.329 a pound.

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Crude oil plunges to hit 8-day low after ECB, U.S. jobless claims

          Crude oil futures extended losses to fall to an eight-day low during U.S. morning hours on Thursday, as appetite for growth-linked assets weakened amid concerns over the fragile economic recoveries in the U.S. and the euro zone.
 
On the New York Mercantile Exchange, light sweet crude futures for delivery in May traded at USD93.21 a barrel during U.S. morning trade, down 1.3% on the day.

New York-traded oil prices fell by as much as 1.5% earlier in the day to hit a session low of USD93.09 a barrel, the weakest level since March 22.

Nymex oil prices fell to the lowest levels of the session after the U.S. Department of Labor said the number of individuals filing for initial jobless benefits rose by 28,000 to a four-month high of 385,000 last week, confounding expectations for a decrease of 7,000 to 350,000.

Market players now looked ahead to Friday’s highly-anticipated U.S. monthly nonfarm payrolls report to further asses the strength of the country’s economy.

Oil traders have long been taking cues from the monthly jobs report, the most-closely followed indicator of U.S. employment, because it offers insight into the economic health of the world's biggest crude oil consumer.

An improving economy is generally correlated with increased demand for oil and fuel products like gasoline.

Prices came under additional pressure after European Central Bank President Mario Draghi voiced concern over the euro zone’s economic outlook, saying that the recovery in the second half of the year is subject to “downside risks”.

Draghi’s comments came after the ECB left rates on hold at a record low 0.75% earlier, in a widely anticipated decision.

Oil prices were further weighed by a stronger U.S. dollar, as dollar-priced commodities become more expensive to investors holding other currencies when the greenback gains.

The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was up 0.85% to trade at 83.58, the strongest level since August.

Elsewhere, on the ICE Futures Exchange, Brent oil futures for May delivery fell 0.55% to trade at USD106.53 a barrel, with the spread between the Brent and crude contracts standing at USD13.32 a barrel.

The spread between the two contracts continued to trade near a nine-month low, due to an improving production outlook in the North Sea and amid growing concerns over the euro zone’s economic outlook.

At the same time, U.S. oil stockpiles at Cushing, Oklahoma, the delivery point for Nymex oil futures, are declining as new pipelines relieve a supply glut there.

Crude inventories at Cushing fell by 287,000 barrels to 49.2 million last week, according to the EIA.
Courtesy : Investing.com

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