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rssUS crude oil futures settle at the lowest level since October 7
Settles at $78.36. Down $2.40 or -2.97%
The US crude oil futures are settling at the lowest level since October 7. The price is settling at $78.36. That’s down $2.40 or -2.97%.
The move to the downside was spurred on by report that the US strategic petroleum reserves fell 3.2 million barrels to the lowest level since June 2003.
The low for the day reached $77.71. The high was up at $80.66.
Major indices close lower for the second time in three trading days
Nvidia and Cisco earnings after the close
The major indices are closing lower for the second time in three days. Energy, financials, materials lead the declines. Nvidia and Cisco on tap to release earnings after the close.
The final numbers are showing:
- Dow industrial average -211.17 points or -0.58% at 35931.04
- S&P index -12.21 points or -0.26% at 4688.70
- NASDAQ index -52.27 points or -0.33% at 15921.58
- Russell 2000 index is down – -28.02 points or -1.16% at 2377.00
The sector winners include:
- real estate, +0.65%
- discretionary +0.59%
- healthcare +0.17%
- utilities +0.14%
The sector losers include:
- energy, -1.74%
- financials -1.11%
- materials -0.63%
- industrials -0.56%
DOE crude oil inventories -2.101M versus 1.398M estimate
The weekly EIA energy inventory levels
- Crude oil -2.101M versus estimate of 1.398M. Last week crude inventories rose 1.0M
- Gasoline -0.132M versus estimate of -0.575M. Last week gasoline inventories felt -0.122M
- Distillates -0.824M versus estimate of -1.229M. Last week distillates fell -2.613M
- Cushing 0.216M versus last week -0.034M.
- Refining utilization 1.200% versus expected 0.7%
- crude oil production 11.4M barrels versus 11.5M last week
The private data released late yesterday showed:
- Crude oil, build of 0.655M
- Gasoline, draw of -2.792M
- Distillates, build of 0.107M
- Cushing, draw of -0.491M
The crude oil drawdown is a surprise given the expectations and the private data
The price of crude oil was trading down one dollar at $79.83 (December). The price is currently trading at $79.89.
Eurozone September construction output +0.9% vs -1.3% m/m prior
Latest data released by Eurostat – 17 November 2021
- Prior -1.3%; revised to -1.4%
- Construction output +1.5% y/y
- Prior -1.6%; revised to -2.6%
A lagging data point but shows a modest bounce in construction output towards the end of Q3 but comes after a steeper drop in August. Supply and capacity constraints will keep more pressure on this in the months ahead.
Eurozone October final CPI +4.1% vs +4.1% y/y prelim
Latest data released by Eurostat – 17 November 2021
- Core CPI +2.0% vs +2.1% y/y prelim
The preliminary report can be found here. This just reaffirms that euro area inflation is at a 13-year high and will keep the pressure on the ECB in defending their narrative that inflation is still transitory going into next year.
China corporate bond defaults to rise next year but authorities will step in – Moody’s
Moody’s expects refinancing and default risks to remain high for certain property developers through the first half of 2022
As for the market as a whole, they see tightened funding access and increased investor risk aversion as key drivers for more defaults next year, arguing that:
“We expect the number of defaulters and amount of defaulted bonds in 2022 to remain low relative to China’s total onshore and offshore bonds. Chinese authorities will encourage debt restructuring or liquidation through the courts for distressed Chinese companies. But the authorities will step in to ensure stability if bond defaults were to spike and trigger systemic risk.”
They particularly single out property developers as being among the high risk profiles, with those having the characteristics of being “high leverage, reliance on the bond market with limited alternative funding channels, large or numerous short-term maturities” most exposed to potential credit risks in the months ahead.
That pretty much covers the likes of Evergrande and Kaisa, to name the two big ones.
The man who died without seeing a woman (1938).
WSJ reports – US to sell $56m in cryptocurrency seized in BitConnect fraud scheme
The Wall Street Journal with the report ICYMI on U.S. authorities to liquidate roughly $56 million in proceeds seized.
- The government said it would start the process of restitution for those who fell victim to the BitConnect scheme by selling the cryptocurrency and holding the proceeds in U.S. dollars.
Here is the link to the Journal (may be gated) for more.
Lower BTC will be used by those wanting to buy the dip. Daily candle bar chart:
PBOC sets USD/ CNY mid-point today at 6.3935 (vs. estimate at 6.3919)
The People’s Bank of China set the onshore yuan (CNY) reference rate for the trading session ahead.
- USD/CNY is permitted to trade plus or minus 2% from this daily reference rate.
- CNH is the offshore yuan. USD/CNH has no restrictions on its trading range.
- A significantly stronger or weaker rate than expected is typically considered a signal from the PBOC.
- The previous close was 6.3917
- Yesterday’s reference rate was 6.3924