Oil prices extended their gains on Monday after surging at the end of last week on short-covering, as traders close record sell positions on crude futures, while a monstrous snowstorm in the U.S. east cost raised demand sharply for heating energy. The recovery remains fragile however, as the markets remain oversupplied, and will continue to be so as Iran readies to pump half a million more barrels after sanctions-relief last week.
Brent crude futures rose 40 cents, or 1.25% to $33.35 a barrel, after soaring 10% on Friday in what was one of their biggest daily rallies ever, while U.S. West Texas Intermediary (WTI) crude futures advanced 24 cents, or 0.75% to $32.48 a barrel, following a surge of nearly 9% on Friday.
Asian markets cheered the oil revival, with Japan's Nikkei climbing 0.80% after hitting a year low last week, while China's Shanghai index rose 0.65%. Hong Kong's Hang Seng index gained a solid 1.12%, while South Korea's KOSPI clutched a 0.80% profit.
Wall Street closed Friday with considerable profits, carried high by energy shares, with Dow Jones ending up 210 points, or 1.33% at 16,093, while NASDAQ rose 119 points, or 2.66% to 4,591. S&P 500 closed up 37 points, or 2.03% at 1,906.
Dollar slipped today as investors dump safe-haven U.S. treasury bills on strengthening risk sentiment, with the greenback index edging down 0.15% to 99.44. Dollar slid 0.20% versus euro to 1.0817, while dipping 0.21% against sterling to 1.4259.
Precious metals are having a field day in tandem with oil, with gold gaining a solid five dollars, or 0.45% to trade back above $1,100 an ounce. Silver futures added 3 cents, or 0.23% to $14.08 an ounce. Copper however gave up ground, with the industrial metal's futures sliding 0.34% to $1.996 a pound.
Investors await some data today, with the German Ifo Business Climate survey expected at 108.5 in January, barely down from December's 108.7. The higher the result is the better for the euro.
From Britain, the CBI Industrial Order Expectations survey is forecast at -10 in January, worsening from December's -7. A result below zero indicates lower orders expectations for the manufacturing sector.