Disappointing U.S. housing data coupled with ongoing concerns that the global economy is awash in crude while demand remains soft sent oil futures falling on Monday. Crude falls on soft housing data, global supply concerns, oil drops on weak U.S. housing data, concerns global supply is outstripping demand. The National Association of Realtors reported earlier that existing home sales in the U.S. unexpectedly fell 1.8% to an annual unit rate of 5.05 million in August. Analysts had expected existing home sales to rise 1% to 5.20 million units, and the figures sent oil prices falling on fears that U.S. recovery continues to face headwinds and may consume less fuel and energy than once thought. Concerns that global oil supply is outstripping demand also battered crude futures. While the U.S. economy is gaining steam despite hiccups here and there, Europe and China are still battling potholes, which have taken its toll on energy markets.
GOLD
Gold futures posted modest gains on Monday after disappointing U.S. housing data prompted investors to lock in gains from the dollar's recent rally and sell the greenback for profits. Gold gains as soft U.S. housing sales halt greenback's rally, gold posts modest gains as dollar rally takes a breather. Gold and the greenback tend to trade inversely with one another. In the U.S. earlier, the National Association of Realtors reported that existing home sales unexpectedly fell 1.8% to an annual unit rate of 5.05 million in August. Analysts had expected existing home sales to rise 1% to 5.20 million units, and the numbers weakened the greenback slightly and gave gold room to rise. The dollar has advanced in recent weeks as markets prepare for U.S. monetary policy to grow less accommodative going forward, while Europe and Japan are seen taking steps to loosen policy to stimulate their economies.
