SHANGHAI, Dec. 9 (SMM) – Market will eye China’s November inflation data and US crude oil stocks on Wednesday.
China’s annual CPI rate is expected to pick up pace in November, driven by rising food prices. China’s PPI, however, is on track to deteriorate further in November, judging from weak official and Caixin’s China manufacturing PMI released earlier. Falling global commodity prices have dragged down raw material import prices and finished product sales prices. This, together with severe overcapacity and mounting stocks, left some companies more aggressive in selloffs for cash. This bodes ill for PPI.
Crude oil market became more sluggish after OPEC announced not to cut production. While connection between base metals price movement and crude oil prices waned somewhat recently, persistent weakness in crude oil prices will remain a drag on commodity market.
US crude oil stocks released by the API unexpectedly fell 1.9 million barrels last week, versus expectations for a 252,000 barrel increase. That said, crude oil stocks in Cushing, Oklahoma, the delivery point for US crude futures, grew 600,000 barrels, indicating still high oversupply pressure.