Oil Rises While World Shares Fall
Hitting land on Monday, the storm ‘Sandy’ had forced everything and everyone to shut down and this applied to the […]
Hitting land on Monday, the storm ‘Sandy’ had forced everything and everyone to shut down and this applied to the New York Stock Exchange as well. However, as the storm subsided by Wednesday, Wall Street was again trading with all shares trading in the red except the crude oil ones, which were on a rise.
‘Sandy’ has changed the course of exchange trading to an extent as the futures on the US lumbar soared as demands are likely to increase after the devastating storm. Gains seen in the crude oil futures were capped to an extent as the demand is likely to be impacted by the storm.
It is known that the East Coast bore the brunt of ‘Sandy’ and reported power outages and flooding, which means that the demand for fuel would be low due to low consumption. However, most refineries of the region escaped unscathed and the Philadelphia refinery, which is also the biggest refinery of the region, ramped up its operations to meet any demands.
The trading pattern showed an increased interest in the lumbar futures by speculators as they anticipated a higher demand. The Chicago Mercantile Exchange witnessed the contracts for the lumbar futures of the months November, December and January rising daily and remained locked at the trading limit of $10 per thousand board feet, eventually shutting down trading.
The trading patterns on the Wall Street were expected to be volatile in the wake of low volume of trading as several of the traders could not make it to the exchange either due to unavailability of public transit or due to the inability to work from home as power outage had left them without any ‘charged’ means of communication.
The Standard & Poor’s 500 Index showed a down ward movement by 0.16 percent or 2.20 points, settling at 1,409.74. The industrial average at the Dow Jones was down by 11.63 percent at 13,095.58, a 0.09 percent fall. The NASDAQ Composite Index did not show any change.
However, it was crude oil that gained as Brent crude rose to trade above $109 a barrel. December delivery of Brent was cited up at $109.12, an increase of 4 cents. $86.21 a barrel was the price seen for the US light sweet crude oil, an increase of 53 cents. Another area to see a rise was the Bond, the 10-year Treasury note of the US which yielded 1.7067 a rise of 1/32 in price. The Euro rose by 0.07 percent against the Dollar and traded at $1.2964.
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