Oil futures traded sharply lower during Monday’s Asian session after a critical economic data point out of China surprised to the downside.
On the New York Mercantile Exchange, light, sweet crude futures for November delivery slid 1.16% to USD101.68 per barrel in Asian trading Monday. The November contract settled lower by 0.16% at USD102.87 per barrel last Friday.
The September reading of the China HSBC Purchasing Managers’ Index came in at 50.2, well below the flash reading of 51.2 and estimates calling for 51.2. Readings above 50 indicate expansion.
"The September HSBC China Manufacturing PMI edged up slightly from August. New orders remained flat from the previous month, while external demand improved,"said HSBC China chief economist, Hongbin Qu, in a statement. "Manufacturers restocking process continued but remained relatively slow. Growth is bottoming out on Beijing’s mini-stimulus. We expect continuous policy efforts to sustain the recovery."
Output "expanded for the second successive month in September, though the rate of growth slowed to a fractional pace. Furthermore, growth of new work was unchanged from the previous month and only slight. Nonetheless, new business from overseas increased for the first time in six months (albeit marginally), with panellists citing stronger demand from client bases in Europe and the US," according to HSBC.
Last Friday, official data showed Chinese industrial firms saw their combined profits jump 24.2% year-over-year in August, following an 11.6% increase in July. Through the first eight months of 2013, Chinese industrial profits increased 12.8%. China is the world’s second-largest oil consumer behind the the U.S.
Elsewhere, Brent futures for November delivery fell 0.56% to USD107.83 on the ICE Futures Exchange.
