Oil extends fall to below $65 in Asian trading

PanARMENIAN.Net - Oil extended its fall to below $65 a barrel in Asian trading Monday, Dec 1, while stocks in Hong Kong led the region lower after a measure of Chinese manufacturing slowed more than expected, adding to concerns about the world’s second-biggest economy, the Wall Street Journal reports..

Traders have been selling oil since a surprise move Thursday by the world’s biggest oil producing nations to stick with their current target levels of production, meaning a glut in the market is likely to remain. Analysts predict prices could fall as low as $60 a barrel in the near term.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in January traded as low as $64.10 a barrel on Monday, down $2.05 from late Friday in New York. They slid 17.9% in November.

The drop rippled through Australia’s benchmark index, which fell 1%. A gauge of Australian energy stocks fell 4.4%, more than offsetting gains in airlines, which benefit from cheaper oil, the Journal says.

There were also downbeat figures from China, with an official gauge giving a manufacturing activity reading of 50.3 for November, below expectations for 50.6 and down from 50.8 in October. Also, an unofficial gauge of nationwide manufacturing activity from HSBC fell to a six-month low, pushing the Hang Seng down 1.4% to 23658.06.

However, the Shanghai Composite continued its five-month rally. The index was last up 0.6%, extending a 7.9% rise last week as investors focused on the central bank’s surprise move on Nov. 21 to cut interest rates to help lift the economy.

Taiwanese stocks were off 0.6% after the island’s Beijing-friendly ruling party suffered a big defeat in local elections, which could complicate the island’s fraught relations with mainland China, its main export market. Trade deals have given Taiwanese fruit growers, fish farmers and other businesses preferential access to the market.

Australian shares slumped, with energy and mining stocks falling heavily on sliding commodity prices and the weak Chinese manufacturing data. The S&P/ASX 200 ended 2% lower.

One of the few winners in Asia was Japan. Lower crude oil prices helped boost the U.S. dollar against the Japanese yen, a net positive for the Nikkei Stock Average, which rose 0.9%. The U.S. dollar was up at ¥119, its highest level since Aug 9, 2007.