(MENAFN- DailyFX) A firmer than expected Caixin China Manufacturing Purchasing Manager Index (PMI) triggered moderate buying of risk assets at the beginning of the Asia week. Although in contraction zone below the 50 division line, it surpassed both prior number at 47.2 and the forecasted 47.6. This helped to sustain risk assets including commodities and commodity currencies, after official PMI reading by the National Bureau of Statistics on Sunday missed forecast at 50.
Copper has been on the mend since Asia open and sets to return to the overnight trading range at the middle of 2.31s region. Upward momentum in copper and the Shanghai Composite index waned shortly after the Caixin reading, thus copper lingers near October low although its decline was trimmed to the lowest in a month.
Though not strong enough to spur bullish bets, the PMI readings eased bearish sentiment on industrial metals. If demand stabilizes during the fourth quarter, there may be chance for a pick-up in the first half of next year. Nickel and lead rose on the London Metal Exchange.
Gold headed on a fourth day of steep declines after the Fed confirmed the possibility of a 2015 rate hike in its October meeting. Gold has focused on the upside today as tepid China's factory growth gauge brought about safe haven bets. A support comes at Friday's low and 50% Fibonacci around 1133.3.
Oil traded in a tight range after three days of increases. China PMI readings failed to prop it up to another higher day. On Friday, crude oil advanced after active rig count tumbled to a five-year low, another sign that US producers are cutting investment in the face of low oil prices. Baker Hughes recorded a drop of 16 rigs, adding to the 81 cut during last two months.
In contrast, gasoline reached a two-week high at 138.81 on NYMEX in the previous session due to a large drop in stocks. This led to gains in oil-refined products and, coupled with high refinery operating rate, may help to ease the oil glut with crude consumption down the line.
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.