Is the Euro-zone sovereign debt crisis weighing on commodity prices?
*The Wall Street Journal, by Dan Strumpf, October 3, 2011
”Crude Sinks on European Debt Woes
Oil futures were down but off their early lows as Europe’s sovereign-debt crisis fueled worries of weakening demand for crude.
Light, sweet crude for November delivery was down $1.04, or 1.3%, at $78.16 a barrel on the New York Mercantile Exchange. The contract had slipped as low as $76.85 in early trade. Brent crude on ICE Futures Europe exchange was down 83 cents, or 0.8%, at $101.93 a barrel, off its low of $100.71.
Futures regained some ground after a report on U.S. manufacturing activity came in better than expected. The ISM manufacturing index for September was 51.6, compared with 50.6 in August.
Still, market participants remained fixated on events in Europe, where investor concerns are mounting following news that Greece will miss its deficit targets this year.
The news sent stock futures lower and stoked concerns that the continent’s sovereign-debt woes would curb economic growth and weaken demand for crude oil. Oil prices have closely tracked equities in recent months, as traders look to the stock market for clues about broader economic sentiment.”
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