SINGAPORE, Aug 26 (Reuters) - U.S. crude rose for a second
day on Thursday as bargain-hunting and short-covering in
equities spread to the oil market, where investors ignored
reports showing slower U.S. economic activity and rising
record-high inventories to take advantage of prices near
11-week lows.
FUNDAMENTALS
* U.S. crude for October delivery <CLc1> rose 25 cents to
$72.77 a barrel, after rising more than 1 percent on Wednesday,
having touched an 11-week intraday low of $70.76.
* Front-month U.S. crude futures' 14-day relative strength
index (RSI) fell to just above 30 on Tuesday, a technical
indication it was nearing an oversold condition, and then
bounced on Wednesday to above 35, according to Reuters data, as
taking profits on short positions after a five-day losing spell
became attractive.
* New U.S. home sales slumped to the slowest pace on record
in July and orders for costly durable goods were weak, separate
reports showed on Wednesday, heightening fears the economy was
at risk of another downturn. []
* That came on top of a private sector report on Tuesday
that sales of previously owned homes in the same month plunged
to their slowest pace in 15 years. []
* U.S. crude inventories rose 4.11 million barrels in the
week to Aug. 20, dwarfing a forecast for a build of 200,000
barrels, the Energy Information Administration said in a weekl
report on Wednesday. []
* However, crude oil inventories at the key Cushing,
Oklahoma, delivery hub fell 779,000 barrels to 36.3 million
barrels, about the only bullish feature in the weekly report.
* Gasoline inventories were 2.27 million barrels higher, at
odds with forecasts of a small drawdown. Distillate stocks
increased by a larger-than-expcted 1.76 million barrels.
* In aggregate, commercial crude and product stocks rose to
1.139 billion barrels last week, topping the record weekly high
of 1.13 billion barrels set in the week to Aug. 13.
* Also sending bearish signals, forecasters revised
downwards their expectations of the oil price both for this
year and next, a Reuters poll revealed on
Wednesday.[]
MARKETS NEWS
* Japan's Nikkei average rose 0.5 percent on Thursday,
buoyed by short-covering in exporters' shares after four days
of falls and as the yen pulled back slightly from a 15-year
high hit earlier this week. []
* Stocks on Wall Street initially fell on Wednesday's
negative economic indicators, but rebounded to end slightly
higher and snap a four-day losing streak as bargain-hunters
inched back into the market.
DATA/EVENTS
* The following data is expected on Thursday, GMT:
- 1230, U.S. Initial jobless claims Weekly
- 1500, U.S. Kansas City Fed survey Aug
- 1600, U.S. Chicago Midwest Jul
RELATED NEWS
* A big high-frequency trading firm faces possible civil
charges by regulators after its computer ran amok and sparked a
frenzied $1 surge in oil prices in February, according to
documents obtained by Reuters and sources familiar with the
continuing investigation. []
* Tropical Depression Seven in the far eastern Atlantic
Ocean strengthened into Tropical Storm Earl late Wednesday, the
U.S. National Hurricane Center said in its latest advisory.
[]
* Early computer models show the system eventually steering
northwest toward Bermuda and away from key oil and gas
producing areas in the Gulf of Mexico, in a similar path to
that expected to be followed by Hurricane Danielle.
(Reporting by Alejandro Barbajosa; Editing by Clarence
Fernandez)
