Crude Oil Ends Higher As Dollar Weakens

(RTTNews) - U.S. crude oil snapped a two-day loss to end higher on Tuesday, ahead of the weekly crude inventory data from the Energy Information Administration even as the dollar weakened against a basket of some major currencies. Oil also found support after some better than expected rise in new orders for U.S. manufactured goods, but gains were checked with some mixed manufacturing activity data out of China.

Investors also continued to track developments in eastern Ukraine with government forces still fighting pro-Russian fighters in border towns in an effort to take control and as well on the Libyan situation.

In economic news, China's manufacturing sector contracted marginally in May, as output shrunk slightly while new orders stabilized after a three-month sequence of declines the HSBC manufacturing Purchasing Managers' Index showed.

Light Sweet Crude Oil futures for July delivery, the most actively traded contract, gained $0.19 or 0.2 percent to close at $102.66 a barrel on the New York Mercantile Exchange Tuesday.

Crude prices for July delivery scaled a high of $102.79 a barrel intraday and a low of $102.23.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 80.54 on Tuesday, down from its previous close of 80.63 late Monday in North American trade. The dollar scaled a high of 80.66 intraday and a low of 80.43.

The euro traded higher against the dollar at $1.3629 on Tuesday, as compared to its previous close of $1.3597 late Monday in North American trade. The euro scaled a high of $1.3647 intraday and a low of $1.3590.

On the economic front, the from the U.S. Commerce Department showed new orders for U.S. manufactured goods rose by a more than expected 0.7 percent in April, after jumping an upwardly revised 1.5 percent in March. Economists expected orders to climb by about 0.5 percent compared to the 1.1 percent increase reported for the previous month.

According to a reading from HSBC, China's final HSBC Purchasing Managers Index stood at 49.4 in May, down from a preliminary estimate of 49.7. However, that was up from April's reading of 48.1.

Meanwhile, Chinese services sector activity rose to a six month high in May, with the index tracking non-manufacturing activity rising to 55.5, from 54.8 in the previous month.

According to flash estimates from Eurostat, eurozone inflation slowed more than expected in May, declining to 0.5 percent, raising concerns about deflationary pressures. Inflation held below the European Central Bank's target of 'below, but close to 2 percent' for the sixteenth consecutive month. The European Central Bank's monetary policy meeting scheduled for Thursday.

Meanwhile, eurozone unemployment rate declined unexpectedly in April, but still remains at a high level with companies cautious over adding staff and meet rising orders with existing employees. The seasonally adjusted jobless rate fell to 11.7 percent, the lowest since November 2011, from 11.8 percent in March. Economists expected the rate to hold steady at 11.8 percent for the fourth straight month. The number of unemployed totaled 18.751 million in April, down by 76,000 from March. The figure fell by 487,000 from a year-ago.