Investing.com- Oil futures traded slightly lower in the early part of Wednesday’s Asian session following a tepid reading of China’s Beige Book, an economic survey modeled after the Federal Reserve equivalent of the same name.
On the New York Mercantile Exchange, light, sweet crude futures for February delivery fell 0.08% to USD90.91 per barrel in Asian trading Thursday. Oil rallied 2.65% during Wednesday’s U.S. session on the back of some encouraging housing data.
S&P/Case-Shiller said that its home price index rose at an annualized rate of 4.3% in October from a year earlier, above expectations for a 4% increase.
U.S. home prices in September rose by an unrevised 3.0%.
Month-on-month, U.S. home prices rose 0.7%, above expectations for a 0.5% increase, after rising by 0.4% in the preceding month. Residential real estate is an integral part of the U.S. economy and encouraging housing data there is seen as supportive to oil prices because the U.S. is the world’s largest oil consumer.
However, oil took a step back in Asian trading Thursday due to the China Beige Book report, which shows an uneven recovery for the world’s second-largest economy. The report showed strength in China’s housing, infrastructure and manufacturing sectors, but new loans and exports were not as strong as some economists expected. As the world’s second-largest oil consumer, China also plays a heavy hand in oil’s price action.
Oil was also able to fight off disappointing holiday sales for U.S. retailers. Shares of U.S. retailers fell sharply in Wednesday’s session on speculation that those companies will have to offer massive post-holiday discounts in an effort to shed inventory.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for February delivery fell 0.03% to USD111.24 per barrel. The spread between West Texas Intermediate and Brent is now over $20.