Oil prices dropped from 10-month highs on Thursday due to weak Chinese trade data.
Thanks to the weak Chinese data released this week, oil prices fell slightly from their 10-month high. Since surpassing the $85 per barrel mark, investors have been extremely cautious and focused on the economic changes, especially on Wall Street and the stock market.
Over the past two weeks, the market has been driven by two main indicators: the commodity market, by which we mean oil prices and future interest rate hikes.
The Federal Reserve sees the labor market as an indicator for measuring its inflation-fighting strategy. Recent better-than-expected earnings data and the releases of the non-payroll farm reports all support the probability of further interest rate hikes. More lilies in this running month and the next.
As for the first market-moving indicator, the labor market specialist believes that the labor market continues to hold up. Yet, the recently released initial job claims suggest otherwise. The numbers were unexpectedly unexpected; the U.S. initial jobless claims dropped to 216.000, higher than market explanations of 234.000 and much higher than the previous month’s 229.000.
Furthermore, here are some of the highlighted numbers that were delivered via the report:
- Weekly jobless claims decreased to 216,000 in the week ending September 2.
- The previous week’s reading was slightly revised upward to 229,000.
- Economists had expected the claims to rise to 234,000, but they fell instead.
- The four-week moving average, which smooths out weekly fluctuations, also decreased to 229,250.
- The number of people receiving benefits after their first week of aid dropped by 40,000 to 1.679 million.
Despite the low numbers, market experts see that the people who lose their jobs will experience short periods of unemployment before finding their next job.
Meanwhile, the service sector in the U.S. reportedly makes up two-thirds of the U.S. economy, with the sector hitting a six-month high in August. Yet, we can’t say the same about the tech sector; the Chinese and U.S. chip breakthrough tensions might affect the stock market again. Law regulators are talking about banning Chinese high-tech companies, and Apple might lose its place in the Chinese market due to the ongoing chip conflict. Analysis says that Apple might lose more than 20 million iPhone shipments in China due to the Chinese chip ban In the U.S. As a result, the tech-heavy Nasdaq was down by 1.07% to 13.722 bps, the S&P 500 benchmark decreased by 0.41% to 4.447.33 bps, and the Dow Jones Industrial Average was up by 0.15% to 34.496 bps.
Moving the oil market Oil prices dropped from 10-month highs on Thursday due to weak Chinese trade data. The fall occurred despite U.S. crude inventories decreasing for the fourth consecutive week.
As of 14:30 a.m. ET, the West Texas Intermediate was down by 0.21% to $87 per barrel, whereas the Bernt price decreased by 0.23% to $90 per barrel.