Crude Oil Prices at Nine-Month Highs Weigh on Global Markets

Selasa, 28 Februari 2012 | 12:00

Sky-high oil prices weighed on markets Monday as investors worried that the increases could choke off a burgeoning economic recovery, particularly in the United States.Sentiment in the markets has been buoyed in recent weeks by a seeming calm in Europe’s debt crisis and a run of strong US economic data, particularly with regard to jobs.

One side-effect of the positive US economic newsflow has been to put upward pressure on oil prices. Despite a modest retreat back below $109 a barrel on Monday, the benchmark New York rate is trading way above where it was just a month ago. Last Friday, it hit $109.77 a barrel, its highest close since May 3. Crude has soared from $96 earlier this month as stronger US economic indicators bolstered investor confidence.

“At this stage of the global economic cycle, with activity in many of the major advanced economies sluggish, a rise in oil prices threatens to intensify the recessionary prospects facing these economies while, at the same time, raising the headline rates of inflation,” said Neil MacKinnon, global macro strategist at VTB Capital.

That fear has weighed on markets Monday.

In Asia, Japan’s Nikkei 225 stock average ended down 0.1 percent, giving up gains posted earlier in the day. Hong Kong’s Hang Seng fell 0.8 percent, and South Korea’s Kospi lost 1.4 percent.

But mainland Chinese shares advanced for a seventh straight trading day as hopes for an easing of restrictions on housing purchases help drive the rally. The benchmark Shanghai Composite Index added 0.3 percent, and the Shenzhen Composite Index gained 0.3 percent.

In Europe, Britain’s FTSE 100 was down 1 percent, while Germany’s DAX fell 1.2 percent. The CAC 40 in France fell 1 percent.

Wall Street was also poised for losses at the open — Dow futures and the Standard & Poor’s 500 futures were lower.

Despite Monday’s retreat, many of the world’s leading indexes are back at levels they were trading at before last summer’s massive sell-off. US markets are faring even better and have even broken through levels last seen before the collapse of US investment bank Lehman Brothers in September 2008. Investors will be watching developments over Europe’s debt crisis closely, especially on Wednesday when the European Central Bank offers its second round of super-cheap long-term loans to banks.

The euro was down 0.3 percent at $1.3419. Gold was 0.4 percent lower at $1,768.80 an ounce