The price of crude oil moved down Thursday morning as weak manufacturing data out of China renewed worries over demand growth.
The flash HSBC Purchasing Managers' Index in China for May slipped under the 50-point level, indicating contraction for the first time in eight months.
Light Sweet Crude Oil (WTI) futures for July delivery, shed $0.82 to $93.46 a barrel. Yesterday, oil settled lower after a weekly oil report from the Energy Information Administration showed crude stockpiles to have dropped lesser than expected, while gasoline stocks rose more than expected. Oil prices also impacted after the U.S. Federal Reserve Chief Ben Bernanke gave indications of slowing down its quantitative easing program in the near future.
Wednesday during trading hours, the EIA said that US crude oil inventories eased 0.30 million barrels, while gasoline stocks were up 3.00 million barrels in the weekended may 17. Analysts expected crude oil inventories to dip 1.2 million barrels last week.
This morning the U.S. dollar continued to level off from its 6-week high versus the euro, while trading flat against sterling. The buck was steady near its 4-year high versus the yen, while hovering around its 10-month high against the Swiss franc.
In economic news, Germany's private sector activity improved from a five-month low, but remained marginally below the neutral level, flash survey results from Markit Economics showed. The composite output index rose to 49.9 in May from a five-month low of 49.2 in April. A reading below 50 suggests contraction.
Meanwhile, euro zone's private sector activity continued to decline in May, but at a slower pace than in the previous month, flash results of a survey by Markit Economics showed. The composite output index, that measures performance of the both manufacturing and service sectors, rose to 47.7 in May from 46.9 in April. Economists expected the reading to rise to 47.2.
The U.K. economy avoided recession in the first quarter as initially estimated, second estimates from the Office for National Statistics showed. Gross domestic product grew 0.3 percent sequentially in the first quarter, offsetting the last quarter's 0.3 percent fall.
Traders will look to the weekly jobless claims report from the U.S. Labor Department due out at 8.30 a.m ET. Economists expect claims to have fell to 345,000 from 360,000 in the previous week.
A little later, the Federal House Finance Agency will release the results of its house price survey for March. The house price index based on the survey is expected to increase 0.9 percent month-over-month compared to a 0.7 percent increase in February.
The Commerce Department will release its new home sales report for April at 10 am ET. The consensus expectations call for new home sales to come in at a seasonally adjusted annual rate of 425,000 from 417,000 in March.
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