Crude oil futures traded lower on Monday morning as the market was disappointed with data related to manufacturing and business activity from China for July.
At 9.55 am on Monday, October Brent oil futures were at $83.92, down by 0.58 per cent, and September crude oil futures on WTI (West Texas Intermediate) were at $80.16, down by 0.52 per cent.
Lacking momentum
August crude oil futures were trading at ₹6,595 on the Multi Commodity Exchange (MCX) during initial trading, against the previous close of ₹6,579, up by 0.24 per cent, and September futures were trading at ₹6,578, as against the previous close of ₹6,564, up by 0.21 per cent.
Data from China indicated that the economic recovery in that country is yet to gain momentum. China’s composite purchasing managers’ index was at 51.1 for July, against 52.3 for June, and 52.9 for May.
China’s manufacturing purchasing managers’ index was at 49.3 for July. With this, China’s manufacturing purchasing managers’ index contracted for the fourth straight month. It was at 51.9 in March.
These numbers indicate that the Chinese economy is struggling to recover. The market is now awaiting stimulus measures by the Chinese government to boost the economy.
China is a major buyer of crude oil in the global market, and a slowdown will impact demand for the commodity.
Despite this, the crude oil market is expected to post its biggest monthly gain in July, since January 2022 due to factors such as the tightening of crude oil supplies and the expected end to the interest rake hike cycle by the US Federal Reserve.
Guar gum slips, turmeric gains
August natural gas futures were trading at ₹218.20 on MCX, against the previous close of ₹215.90, up by 1.07 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), August guar gum contracts were trading at ₹12,514, against the previous close of ₹12,823, down by 2.41 per cent.
August turmeric (farmer polished) futures were trading at ₹14,920 on NCDEX, against the previous close of ₹14,772, up by 1 per cent.