U.S. crude oil jumped to a two-week high to settle sharply higher on Friday, following some better-than-expected U.S. jobs data and service sector activity that helped soothe investor sentiments. A weaker dollar also supported the commodity. Oil prices had dipped earlier in the week after the Federal Reserve and the European Central Bank refrained from announcing any further quantitative easing for economic growth and to tackle the eurozone sovereign debt crisis.
Meanwhile, some tight supplies reported from Europe due to maintenance work in the North Sea and fear of tensions in the Middle East also helped crude prices.
Light Sweet Crude Oil futures for September delivery surged $4.27 or 4.9 percent to close at $91.40 a barrel on the New York Mercantile Exchange Friday.
Crude prices scaled a high of $91.74 a barrel intraday and a low of $87.23.
Yesterday, oil ended lower on concerns over the eurozone sovereign debt crisis with investors disappointed at the European Central Bank meeting outcome with no concrete proposals for tackling the financial crisis.
The euro traded higher against the dollar at $1.2386 on Friday, as compared to $1.2180 late Thursday in North America. The euro scaled a high of $1.2391 intraday and a low of $1.2168.
The dollar index, which tracks the U.S. unit against six major currencies, traded at 82.38 on Friday, down from from 82.32 in North American trade late Thursday. The dollar scaled a high of 83.37 intraday and a low of 82.29.
In economic news, the U.S. Labor Department said non-farm payroll employment increased by 163,000 jobs in July following a downwardly revised increase of 64,000 jobs in June. Economists expected employment to increase by about 100,000 jobs compared to the 80,000 jobs increase originally reported for the previous month. Despite the job growth, the unemployment rate edged up to 8.3 percent in July from 8.2 percent in June.
The Institute for Supply Management's survey of activity in the service sector in the month of July showed continued growth at a slighter faster rate. The ISM said its non-manufacturing index crept up to 52.6 in July from 52.1 in June, with a reading above 50 indicating growth in the service sector. Economists expected the index to edge down to a reading of 52.0.
Elsewhere, eurozone retail sales volume rose 0.1 percent month-on-month in June, Eurostat reported. The June increase was in contrast to a 0.1 percent decline forecast by economists. In May, retail trade increased 0.8 percent. On a yearly basis, retail sales fell 1.2 percent in June, bigger than the 0.8 percent drop logged in May. Economists had forecast a 1.9 percent drop for June.
Meanwhile, a survey report from Markit Economics revealed that the private sector in the euro zone contracted for the tenth time in the past 11 months. The final composite output index rose to 46.5 from 46.4 in June, Friday. According to flash estimate, the index remained unchanged at 46.4.
by RTT Staff Writer
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