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Crude holds steady on firming U.S. consumer sentiment

Published 11/11/2012, 08:00 PM
Updated 11/11/2012, 08:01 PM
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Investing.com - Crude oil futures held steady in Asian trading on Monday through slightly off gains posted after consumer sentiment data beat expectations in the U.S., hitting a five-year high.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in January traded at USD86.50 a barrel on Monday, down 0.06%, off from a session high of USD86.58 and up from an earlier session low of USD86.39.

The Thomson Reuters/University of Michigan preliminary consumer sentiment index hit 84.9 for November, a five-year high and up from 82.6 in October.

The number beat a median forecast of 83.0.

The news, which broke on Friday, sent oil prices gaining initially on expectations that the U.S. economy is strengthening and will demand more fuels and energy going forward.

Profit-taking kicked in later in the Friday's U.S. session, which carried over into Asian trading on Monday.

Prices weren't set to fall too far.

Data revealed that Chinese industrial production rose by 9.6% in October, outpacing expectations for a 9.4% increase an up above a 9.2% rise in September.

News that Chinese exports grew by 11.6% on year in October also bolstered demand for oil though proft-takers continued to cap gains.

Fears that the U.S. risks falling into an avoidable recession continued to cast doubt on capital markets worldwide.

At the end of this year, the Bush-era tax cuts and other tax benefits expire at the same time pre-programmed cuts to government spending are scheduled to take effect, a combination known as a fiscal cliff that could send the country into recession if left unaddressed by Congress.

Lawmakers have expressed confidence that they'll avoid partisan bickering in the past and cut a deal, but until an announcement hits the wire, investors will remain wary.

On the ICE Futures Exchange, Brent oil futures for January delivery were down 0.30% and trading at USD108.09 a barrel, up USD21.59 from its U.S. counterpart.









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