The crude oil prices fall account for a third day because of weak data on consumer confidence in the U.S. and alarming signs of economic growth in China. The U.S. consumer confidence in June dropped heavily to the level of 52.9 points in June, after a month earlier was 62.7 points. This prompted a sharp drop in U.S. stock exchange yesterday, as predictions were for much more limited decrease in the index. On the New York Stock Exchange yesterday, oil contracts with delivery in August fell by 3 percent to 75.94 dollars a barrel. This is the largest decline in raw material from June 4 onwards. The night continued retreat of the quotes this morning and they were 0.4 percent lower at 75.66 dollars a barrel. Thus, the raw material is directed to the first quarterly drop in prices from late 2008 onwards. From late March till now, oil has dropped by 9.4 per cent. Yesterday in London, Brent crude oil from the supply in August fell 2.8 percent to 75.44 dollars a barrel.
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With significant losses U.S. indexes ended the exchange session on Tuesday. Decrease was caused by a data consumer confidence in the country, which showed a greater decline in June compared to expectations of market experts. “Even a technical recession to end last summer, consumers remain concerned about their jobs and future income, refrain from purchases that would contribute to sustainable GDP growth,” Dan told MarketWatch Griyhaus, chief analyst at the investment company Miller Tabak. His words are confirmed by statistics on U.S. consumer confidence this month, which fell after three consecutive increases. According to the confidence index of business organization Conference Board decline quite sharply – up 52.9 points to 62.7 points in May. Expectations of most economists was for a value of 62 points in June. The organization indicated that the main reason for the decline is precisely the uncertainty about the future of the labor market. While no permanent recovery observed in this market can hardly be expected improvement in consumer confidence and consumption, respectively, analysts say. Exchange session ended in New York for Dow Jones Industrial Average with the collapse of 2.64 per cent to 9871 points, S & P 500 fell 3.1 percent to its lowest level this year – 1041 points, and Nasdaq Composite marked loss nearly 3.9 percent to 2135 points.
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The end of the working week has brought the closure of three U.S. banks. Thus the number of bank failures in the country since the beginning of the year amounted to 86 and is on track to improve last year’s record of 140 closed financial institutions – the highest number since 1992. Federal deposit insurance corporation in (FDIC) has closed banks in the states of Florida and New Mexico, Georgia, as buyers are financial institutions by the states. The three failure will cost the FDIC 284,6 million dollars. “The growing problems in commercial property and the ongoing crisis in housing loans will cause many bankruptcies,” said Walter Mix, managing director at financial consulting firm LECG LLC. Over the next three and a half years the bank will claim the bankruptcy 60 billion dollar fund to FDIC, said by the corporation on 22nd June. Fund out of deficit in third quarter of last year. Florida-based Peninsula Bank was purchased by Premier American Bank, owned by Bond Street Holdings LLC. January Holding buy two troubled banks. First National Bank of Jordan was been sold by the FDIC of Savannah Bank, a High Desert State Bank in New Mexico – the First American Bank. In the first quarter of this year the list of troubled banks FDIC counts 775 institutions with assets of 431 billion.
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The leaders of the eight most industrialized countries have different views on how to ensure recovery of the world economy. The G-8 in Huntsville, Canada the weekend will probably show the direction of meeting the broader group of G-20 meets on Sunday in Toronto, Canada, shortly after the G-8 completed work. Agency notes that expectations for a breakthrough on economic issues the Summit of the G-8 (Group of Eight most industrialized countries) and D-20 (which includes large emerging countries like China and India) in Canada are weak. According to the Wall Street Journal, however, world leaders have converged positions on whether the economic focus should be on growth or on reducing the deficits and debts. “Among the G-8 consensus on a balance between mid-term tightening of fiscal policy and promoting growth, said on Friday a senior official of the administration of the US President Barack Obama. The G-8 and donor groups have promised to make 2015 a total of 7.3 billion dollars to reduce child mortality and maternal in poor countries, transmit dpa, referring to the Canadian Prime Minister Stephen Harper. The eight most developed industrialized countries are committed to allocate $ 5 billion. The rest of the amount promised by countries like New Zealand and Norway, as well as donor groups such as the Foundation of the Bill and Melinda Gates. U.S. President Barack Obama invited 18 African leaders to come to Washington in August to celebrate the 50th anniversary of independence of their countries forward AFP, citing a senior U.S. delegation to the summit of the G-8. Obama will launch in early August a special event to mark the coming of a half century of independence of these former colonies.
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The French Government announced on Friday a new tax increase amounted to 3.5 billion in 2011, reported Financial Times. The total increase in tax revenue next year will reach 13.2 billion, ahead of Germany’s program to reduce the budget deficit amounting to 11 billion euros in 2011. Revenue from the increase, however, retreated to the increase in VAT by 2,5 percentage points in Britain next year, which is expected to bring 12.1 billion pounds (14.7 billion). The series of tax increases to reduce budget deficit expected for this year’s 8 percent of GDP to 6% in 2011 as promised to the European Union (EU). The plans are based on forecast economic growth of 2.5 percent next year, the International Monetary Fund (IMF), the EU and many economists are optimistic about. The last tax increase should reassure the financial markets, but not cause panic in society. Earlier in the month the French government announced increased taxes on business and the rich worth 3.7 billion euros to help fill the deficit in the pension system. Paris still hopes to collect 1 billion in 2011 from the new bank tax.
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The crude oil price rose over 3% to near 79 dollars a barrel after the National Center for hurricanes in the United States estimated that 80% is likely forming tropical storm in the Atlantic to strike the Gulf this weekend. This will disrupt oil production in the bay and will make cleaning the oil spill caused by the explosion and sinking of the oil platform BP Deepwater Horizon. About 31%, or 1.69 million barrels of daily production of crude oil in the U.S. comes from platforms in the Gulf of Mexico. The strong rise in the price of energy and raw materials contributed depreciation of the dollar which retreated from almost all major currencies. Oil futures rose 3.1 percent, or 2.35 dollars to finish the trade in New York at the level of 78.86 dollars a barrel. This was the biggest daily rise since June 9 and the highest price level for last seven weeks. Euro more expensive by about half a percent against the dollar to 1.2387 dollars per euro. Fall of course the dollar and lowers oil price expressed in other currencies. This increased the Brenta to 1.86 dollars or 2.4 percent, to 78.33 dollars per barrel on the International Petroleum Exchange in London.
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The price of crude oil remains below 77 dollars per barrel, resulting in what is about to record the first week retreat for the last three weeks. The reason for uncertainly movement of quotations gives renewed fears of economic development. Yesterday the price of black gold stabilized after two days of decline, which contributed data on the growth of durable goods orders in the U.S. and the decline in initial unemployment in the country. The crude oil contracts with delivery in August rose 16 cents minimum to 76.51 dollars a barrel. This morning also lost raw materials 0.3 percent to 76.29 dollars per barrel, but the quotations are about to rise for the week of 0.6 per cent. On the London Stock Exchange this morning Brent with delivery in August lost 0.22 percent to 76.30 dollars a barrel. The price started increasing after the fiasco of the US Dollar last month and hard offence over the crude oil prices.
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The U.S. shares lost positions in the last hours of trading stock on Thursday, with unsatisfactory results dragged down shares of companies trading in consumer goods, while the energy sector has suffered due to uncertainty about the moratorium on drilling for oil in deep waters. Standard & Poor’s 500 has made a loss for the fourth straight day – the longest red index series for seven weeks. S & P 500 fell 1.68 percent to 1074 points. Nasdaq Composite lost 1.63 percent to 2217 points. “The mood of the market is bleak,” said Steve Sosnik, strategist Timber Hill LLC / Interactive Brokers Group LLC. “The feeling is not good, and the reason is not just one article or adopting a new law. This is a disease, “he added. Dow Jones Industrial Average lost 1.41 percent to 10,153 points. J.P. Morgan Chase and Bank of America lost their positions in anticipation of new details about the legislation governing the financial sector, which is expected to agree the Senate and Congress in Washington. The new law is likely to tighten control over the financial sector more than analysts expected. Lawmakers have agreed on new capital requirements for banks that will have a five-year grace period. According to a clause proposed by Congress, the White House administration will be able to levy any bank that failed to repay the Federal Reserve rescue packages for granted during the financial crisis.
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The session futures exchanges has brought a decline in the price of key raw materials. With reductions are reported oil, gold and silver, as it gave rise to mainly disappointing data on the U.S. housing market. Oil with delivery in August fell 1.9 percent to 76.35 dollars a barrel yesterday. To contribute to this reduced estimate of the Federal Reserve for the development of American economy, which was announced together with the decision of maintaining historically low interest rates in the country. This morning quotes lost another 5 cents to 72.30 dollars a barrel. Yesterday in London, Brent crude oil from the delivery in August lost 2.3 percent to 76.27 dollars a barrel earlier this morning, a raw material lost another 4 cents to 76.23 dollars a barrel. During the exchange session in New York yesterday was reporting a fall in gold price with delivery in August by 0.5 percent to 234.80 dollars an ounce. Depreciation of the metal came because the appreciation of the dollar before Fed decision, submit the Market Watch. Much more serious was the decline in the price of silver, which lost 44 cents, or 2.3 percent, to 18.45 dollars an ounce. According to analysts, the retreat of raw materials due to the sharp decline in sales of homes in the U.S.. The reason for it is the end of the government program to assist buyers, which obviously reduced the strong interest in purchasing a home.
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The crude oil routed traffic and was last night reported a decline of nearly a percentage. The main reason is shrinking optimism that the change in the exchange rate of China will help restore the global economy. During yesterday’s trading session in New York oil contract with delivery in July rose 0.8 percent to 77.82 dollar per barrel. At night, however raw material lost nearly a percent to 77.07 dollars a barrel. The deadline for July futures trading ends today, which makes the contracts with delivery in August, more actively traded. Tonight, they fell by 0,9 percent to 77.89 dollars per barrel. Downward movement in oil prices due to the limitation of optimism on stock markets. Moreover, the American bank Goldman Sachs released a new forecast of the development in the oil market, which is set at a lower price of raw material to previous expectations. The new bank is expected over the next three months to price reached 87 dollars per barrel, with whole 9.4 percent below the previous forecast of 94 dollars per barrel. Exchange in London yesterday by Brent oil with delivery in August rose 0.8 percent to 78.82 dollars a barrel.
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