(Photo: Reuters)
The ADP National Employment Report said that the US nonfarm payrolls change in May reached 152,000 jobs, down sharply from the revised 188,000 jobs decline in the previous month, as well as lower than the 173,000 new jobs forecast by analysts.
The data reflects a contraction in the US labor market, raising expectations that the US Federal Reserve (FED) may enter a period of interest rate cuts in the near future to avoid a “hard landing” of the economy . Oil prices were significantly supported after this data.
Traders now see a nearly 69% chance of a rate cut in September, up from 50% last week, according to CME's FedWatch tool.
In addition, data from the Institute for Supply Management (ISM) showed that the US non-manufacturing purchasing managers index recorded 53.8 points in May, higher than market forecasts and indicating a return to expansion after a contraction in May. The S&P Global Composite PMI also beat forecasts, reaching 54.5 points, despite concerns that US economic activity is under pressure. This has increased optimism in the crude oil market.
On the supply and demand side, the US Energy Information Administration (EIA) reported that gasoline and distillate inventories rose by 2.1 million barrels and 3.19 million barrels, respectively, in the week ending May 31, reflecting continued sluggish demand. However, commercial crude inventories rose by 1.23 million barrels, lower than the API's reported 4 million barrel increase in the morning session, limiting pressure on prices.
In addition, with oil prices continuing to cool down to a near four-month low, US Energy Secretary Jennifer Granholm said on Tuesday that the US could speed up the pace of replenishing its Strategic Petroleum Reserve (SPR). The information also supported the recovery of oil prices.
According to the Vietnam Commodity Exchange (MXV), the world raw material market was divided in trading yesterday, June 5. Green and red colors intertwined on the price board, however, buying power was somewhat dominant, supporting the MXV-Index to close the day up slightly by 0.07% to 2,273 points, breaking the previous 5 consecutive days of decline.
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