Oil steady in thin trade

Filomena Scalise

Filomena Scalise

Published Feb 11, 2013

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Singapore - Oil and equities dawdled on Monday near multi-month highs scaled after robust Chinese trade data last week, while the euro slipped to a two-week low as uncertainty surrounded a political scandal in Spain and a looming election in Italy.

With the Lunar New Year holiday shutting most Asian financial centres, including those in Japan, China, Hong Kong, Singapore and South Korea, trading was light and potentially volatile on those exchanges that remained open.

Australian shares were flat after closing at a 34-month high on Friday following positive data from China, the most important consumer of Australia's commodity exports.

S&P 500 index futures inched up 0.1 percent after the Wall Street benchmark reached a five-year high on Friday.

Brent crude oil, which touched its highest in nine months on Friday, was unchanged just below $119 a barrel.

Foreign exchange trading was choppy in thin volumes, with what traders interpreted as slightly dovish comments from the European Central Bank last week also weighing on the euro, which has shed around 2.5 percent since reaching a 15-month high above $1.37 on February 1.

The euro briefly fell to $1.3325 on Monday, after stop-loss selling was triggered below $1.3340, traders said, before recovering to stand little changed around $1.3370.

There are growing worries about Spain as a scandal on secret cash payments engulfs the prime minister, while confidence in Italy has been shaken in the run-up to a February 24-25 election. “The euro's upside is likely to be limited and short-lived,” said Aroop Chatterjee, an analyst at Barclays Capital.

“Better financial conditions are likely to be offset by rising political risks, market positioning and a weaker economy. We expect the euro to be on a declining trend beginning in Q2.” - Reuters

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