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Wall St. slides as Senate delays healthcare vote

Stocks fell broadly on Wall Street on Tuesday, with indexes extending their declines after a delay in a healthcare bill vote in the U.S. Senate raised fresh questions about the timeline of President Trump's domestic agenda.

The Dow Jones Industrial Average (DJI) fell 98.89 points, or 0.46 percent, to 21,310.66, the S&P 500 (SPX) lost 19.69 points, or 0.81 percent, to 2,419.38 and the Nasdaq Composite (IXIC) dropped 100.53 points, or 1.61 percent, to 6,146.62.

The S&P fell the most in about six weeks and closed at its lowest since May 31.

Oil prices weighed down as U.S. inventory gains revive glut worries

Oil markets were steady to lower on Wednesday after a report of rising U.S. fuel and crude inventories underscored concerns that a three-year supply glut is far from over.

Brent crude futures (LCOc1) were at $46.67 per barrel at 0329 GMT, close to their last close.

U.S. West Texas Intermediate (WTI) crude futures (CLc1) were down 8 cents, or 0.2 percent, at $44.16 per barrel.

Oil had recovered some ground over the past week after falling nearly 20 percent since mid-May, but a report by the American Petroleum Institute (API) showed that U.S. crude inventories rose by 851,000 barrels in the week to June 23 to 509.5 million, compared with analysts' expectations for a decrease of 2.6 million barrels.

Gasoline stocks rose by 1.4 million barrels even though the U.S. summer driving season began a few weeks ago. [API/S]

The U.S. inventory gains show global supplies are still ample despite the effort by the Organization of the Petroleum Exporting Countries (OPEC) to cut output by 1.8 million barrels per day (bpd) between January 2017 and March 2018.

Ian Taylor, head of the world's largest independent oil trader Vitol, says Brent crude prices will stay in a range of $40-$55 a barrel for the next few quarters as higher U.S. production slows a rebalancing of the market.

"Everybody was positioned for a market rebalancing and a stocks draw to happen in the second quarter. And if you look at the macro analysis, that should start happening," Taylor said in an interview with Reuters.

"But so far it hasn't happened and everyone has made the same mistake. Nobody has distinguished themselves," he said.

Some analysts said that crude prices had likely bottomed out and would rise.

"We believe that the selloff in crude is overdone ... Brent is primed for a recovery," BMI Research said.

Japanese stocks edge towards two-year high, dollar firms before Yellen

Japanese stocks edged towards two-year highs on Tuesday as exporters benefited from dollar strength, with investors expecting comments from Federal Reserve Chair Janet Yellen to support the Fed's projection for one more interest rate rise this year.

Spreadbetters expected a slightly higher open for Britain's FTSE (FTSE), Germany's DAX (GDAXI) and France's CAC (FCHI).

Yellen is scheduled to take part in a discussion on global economic issues at London's Royal Academy and a number of other top Fed officials are also due to speak later in the global day.

Japan's benchmark Nikkei (N225) was last up 0.3 percent at 20,210.09 in subdued trading. A rise above 20,318.11, a peak scaled a week ago, would take the Nikkei to its highest since August 2015.

"The fundamental mood is not bad, but it's hard for investors to find direction on a day where there are no other major catalysts other than a weak yen," said Hikaru Sato, a senior technical analyst at Daiwa Securities in Tokyo.

Despite lower Treasury yields, the dollar extended overnight gains and was firm at 111.800 yen after briefly rising to a one-month peak of 112.075.

Long-dated Treasury yields dropped to seven-month lows on Monday and the yield curve between five-year notes and 30-year bonds fell to its flattest level since 2007 after the weak U.S. durable goods orders raised concerns about tepid growth and slowing inflation. [US/]

The euro was steady at $1.1189 having fallen back from an 11-day high of $1.1220 overnight after European Central Bank President Mario Draghi defended the central bank's easy monetary policy.

Otherwise, Asian markets lacked strong direction as Wall Street provided few catalysts after the S&P 500 (SPX) and the Dow (DJI) closed overnight effectively flat. (N)

MSCI's broadest index of Asia-Pacific shares outside Japan (MIAPJ0000PUS) stood little changed.

Having made record highs during the past two months on expectations that exporters will post strong earnings, South Korea's KOSPI (KS11) rose a further 0.3 percent.

Elsewhere, Shanghai's benchmark index (SSEC) and Australian shares (AXJO) were both down 0.1 percent.

There was also a general sense of caution in financial markets, analysts said, noting that commodities like crude oil, which is suffering from a glut, remained shaky though a recent selloff has stalled.

"Although iron ore and crude prices are stabilising, their recovery lacks strength. The U.S. equity market also hovers at a high level, but its performance is spotty with high-tech shares falling," said Masafumi Yamamoto, chief forex strategist at Mizuho Securities in Tokyo.

Crude oil was on track to rise for the fourth straight day although concerns over a festering supply glut capped prices. [O/R]

U.S. crude futures (Clc1) were up 0.2 percent at $43.48 a barrel. The contract had retreated to a 10-month low of $42.05 a barrel last week before the sharp retreat stalled, but it remained on track for a monthly loss of about 10 percent.

Oil up for fourth day on short-covering, supply glut caps gains

Oil prices rose for a fourth consecutive session on Tuesday as investors covered short positions, although worries over a persistent global supply glut still lingered.

Brent crude futures (LCOc1), the international benchmark for oil prices, gained 35 cents, or 0.7 percent, to $46.18 per barrel by 0715 GMT.

U.S. West Texas Intermediate (WTI) crude futures (CLc1) were up 30 cents, or 0.7 percent, at $43.68 per barrel.

The gains mean the market is up slightly so far this week, after spending much of the last month in negative territory.

"Oil may be close to the bottom but badly damaged sentiment and a rising (U.S.) rig count will dent the recovery," U.S. bank Citi said on Tuesday.

The Organization of the Petroleum Exporting Countries (OPEC) and its partners have been trying to reduce a global crude glut with production cuts. OPEC nations and 11 other exporters agreed in May to extend cuts of 1.8 million barrels per day (bpd) until March 2018.

Despite the cuts, which started in January, markets remain well supplied due to rising output elsewhere.

OPEC members Nigeria and Libya are exempt from the cuts and have raised production. OPEC member Iran was also allowed a small increase to recover market share lost under Western sanctions over its nuclear programme.

U.S. shale oil output has risen about 10 percent since last year to 9.4 million bpd , with the number of U.S. oil rigs in operation at the highest in more than three years. [RIG/U]

"Traders are also looking ahead to the EIA Energy Conference in Washington, where U.S. shale oil producers are expected to give their view of current market conditions," ANZ bank said.

Analysts at Bank of America-Merrill Lynch said demand was not growing quickly enough to absorb output, especially since imports in Asia are stuttering.

A fuel glut in China, a hangover from demonetisation in India, and an ageing, declining population in Japan are holding back crude oil demand growth in three of the world's top four oil buyers.

Oil rises one percent on weaker dollar, but U.S. drilling drags

Oil prices rose 1 percent early on Monday on a weaker dollar, but an increase in U.S. drilling activity stoked worries that a global supply glut will persist despite an OPEC-led effort to curb output.

Global benchmark Brent crude futures were trading up 45 cents, or 1.0 percent, at $45.99 per barrel at 0623 GMT.

U.S. West Texas Intermediate (WTI) crude futures were up 43 cents, or 1.0 percent, at $43.44 per barrel.

Analysts said oil prices extended gains as investors covered short positions, but there was little fundamental news supporting prices.

"It is just the fact that the oil market stopped falling... I suspect short covering," said Ric Spooner, chief market analyst at CMC Markets in Sydney.

"And a slight support from a weak U.S. dollar."

The U.S. dollar index stayed low on Monday against a basket of currencies amid fading expectations for the Federal Reserve to hike interest rates again later this year. A weaker dollar also makes oil cheaper for countries using other currencies.

"Commodities stabilised after a turbulent week where most sectors suffered large falls," ANZ bank said in a note. "A slightly weaker U.S. dollar also helped improve investor appetite."

Although oil prices have bounced back from 10-month lows, they are still down about 13 percent since late May, when the Organization of the Petroleum Exporting Countries (OPEC) and some other producers agreed to extend a deal to reduce output by 1.8 million barrels per day (bpd) until the end of next March.

But crude supplies in the United States, which is not part of the OPEC-led deal, have been dampening the impact of curbs.

U.S. energy firms added 11 oil rigs in the week to June 23, bringing the total count up to 758, the most since April 2014, according to data from energy services firm Baker Hughes Inc..

Amid the rise in U.S. drilling activity, money managers cut net long U.S. crude futures and options holdings to their smallest long position since November.

Asia stocks edge up on optimism over global growth, dollar soft

Asian shares edged up on Monday on optimism for global growth, while the dollar was on the defensive as a subdued U.S. inflation outlook capped U.S. bond yields and raised questions about the Federal Reserve's plans to tighten policy.

European shares are seen opening little changed. Spread-betters expect Britain's FTSE (FTSE) to open 0.1 percent higher and Germany's DAX (GDAXI) and France's CAC (FCHI) to start almost flat.

MSCI's broadest index of Asia-Pacific shares outside Japan (MIAPJ0000PUS) ticked up 0.4 percent as tech counters led gains in Korean (KS11) and Taiwanese (TWII) shares to record highs and 27-year highs respectively. [

Trading was slow with many markets in the region closed for holidays to celebrate the end of Ramadan.

Japan's Nikkei (N225) rose 0.1 percent.

Mainland Chinese shares rallied, with the CSI300 index (CSI300) rising 1.2 percent to hit its highest level in almost a year and a half, after the MSCI chief said the index provider could raise its weighting of China's mainland-listed 'A' shares.

The prospect of solid global economic growth has kept alive investor optimism for world equities even as some markets, including Wall Street, have slowed from a meteoric run because of high valuations.

Share prices have also been supported by relatively loose monetary policies in the developed world, with the Bank of Japan and the European Central Bank still pumping in funds.

The U.S. Federal Reserve is gradually tightening its policy, but investors think the pace of its tightening will be much slower than policymakers want, given subdued U.S. inflation.

Money market futures price in only about 50 percent chance of another rate hike by the end of the year, compared to Fed's own projection of one more rate increase.

That hardly changed after San Francisco Fed President John Williams said the U.S. central bank needs to keep raising rates gradually with the U.S. economy at full employment and inflation set to hit the Fed's two-percent target next year.

The 10-year U.S. Treasuries yield (US10YT=RR) stood at 2.153 percent, not far from seven-month low of 2.103 percent hit mid-June, after news that inflation had undershot expectations for a third straight month.

The 30-year yield hit 7-1/2-month low of 2.710 percent (US30YT=RR) on Friday, making the yield curve the flattest in almost a decade. It last stood at 2.722 percent.

The lower yields have put the dollar on the defensive, though some market players say both Treasury yields and the dollar could rise if U.S. President Donald Trump manages to push his healthcare bill through Congress.

"There will be renewed focus on U.S. healthcare bill. Its passage in the parliament could lead to expectations that the administration will get down to stimulus next," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.

Republican Senate leader Mitch McConnell has pushed for a vote on the bill before the July 4th Independence Day holiday recess that begins at the end of this week.

Yet he can afford to lose the support of only two Republicans in the face of unanimous Democratic opposition, while five Republican senators have said they will not support the bill in its current form.

The dollar stood at 111.29 yen , off last week's high of 111.79.

The euro traded at $1.1194, slowly recovering from its three-week low of $1.1119 touched on Tuesday.

A strong reading in Germany's Ifo business sentiment survey due at 0800 GMT could open the way for a test of $1.1296, its seven-month high hit earlier this month.

The euro was little damaged by the news that Italy began winding up two failed regional banks on Sunday in a deal that could cost the state up to 17 billion euros ($19 billion).

"This won't cause a major financial crisis considering the current strength of the euro zone economy," said Yukio Ishizuki, senior strategist at Daiwa Securities.

Oil prices ticked up after having fallen for five weeks in a row on concerns OPEC-led production cuts have failed to ease a global crude glut stemming in part from increased U.S. oil production.

U.S. energy firms added 11 oil rigs in the week to June 23, bringing the total count up to 758 , the most since April 2014, according to data from energy services firm Baker Hughes Inc.

Brent crude futures (LCOc1) rose 1.1 percent to $46.02 per barrel from seven month lows of $44.35 hit last week.

U.S. West Texas Intermediate (WTI) crude futures (CLc1) fetched $43.47 per barrel, up 1.1 percent on the day and extending gains from their 10-month low of $42.05 set on Wednesday.

"There is some support near $40 in the WTI. People think that U.S. shale development will stop if it falls below $40," said Tatsufumi Okoshi, senior economist at Nomura Securities.

Weekly Comic: Booming U.S. shale production sends oil into bear market territory despite OPEC efforts

Oil prices recovered slightly on Thursday morning, after falling to their lowest level in around ten months a day earlier amid lingering concerns over strong shale output growth in the U.S.

U.S. crude was at $42.89 a barrel in New York trade, up 36 cents, or around 0.9%, after touching its lowest since August 11 at $42.05 in the prior session.

Brent oil tacked on 52 cents to $45.34 a barrel. The global benchmark hit $44.35 on Wednesday, a level not seen since November 14.

Since peaking in late February, oil has dropped around 20%, meeting the technical definition of a bear market.

Crude prices have been under pressure in recent weeks as concerns over a steady increase in U.S. production added to fears over a glut in the market.

U.S. drillers last week added rigs for the 22nd week in a row, according to data from energy services company Baker Hughes, implying that further gains in domestic production are ahead.

According to the U.S. Energy Information Administration, domestic output climbed by 20,000 barrels to 9.35 million barrels a day last week, almost 8% higher than the same period last year.

The increase in U.S. drilling activity and shale production has mostly offset efforts by OPEC and other producers to cut output in a move to prop up the market.

Last month, OPEC and some non-OPEC producers extended a deal to cut 1.8 million barrels per day in supply until March 2018.

So far, the production-cut agreement has had little impact on global inventory levels, prompting market analysts to downgrade their oil price forecast for this year to as low as $20.

Oil edges up, but still set for worst first-half performance in 20 years

Oil edged up on Friday, recovering some of its steep falls earlier in the week, but crude is still set for its worst first-half decline in two decades despite ongoing production cuts.

Brent crude futures (LCOc1) were at $45.33 per barrel at 0647 GMT, up 11 cents, or 0.2 percent, from their last close.

U.S. West Texas Intermediate (WTI) crude futures (CLc1) were up 9 cents, or 0.2 percent, at $42.83 per barrel.

Oil prices have fallen about 20 percent this year despite an effort led by the Organization of the Petroleum Exporting Countries (OPEC) to cut production by 1.8 million barrels per day (bpd) that has been in place since January.

That's the worst first-half performance for crude oil since 1997, when rising output and the Asian financial crisis led to sharp price falls.

Prices are also still down around 15 percent since OPEC extended on May 25 its cuts to cover the first quarter of 2018 instead of expiring at the end of this month.

The weak markets are a result of doubts over OPEC's ability to rein in a fuel supply overhang that has dogged markets since 2014 as production has largely outpaced consumption.

"The post-OPEC meeting slide in prices has lasted longer and pushed lower than we had anticipated in late May," U.S. bank JP Morgan said in its half-year outlook.

"Oil and products comprise five of the ten worst performing commodities this year, owing more to excess supply than to below-average demand," it added.

JP Morgan is not just bearish in its short-term outlook.

"By early 2018, the combination of record U.S. production and deteriorating OPEC compliance probably returns average prices to the mid-to-low $40s," it said.

At the heart of the glut is that the recent efforts to reduce production from the traditional suppliers of OPEC and Russia has been met by soaring output from the United States.

Thanks to shale drillers, U.S. oil production has risen by over 10 percent in the last year to 9.35 million bpd, close to the level of top exporter Saudi Arabia.

Excess production has left storage tanks bloated.

"Inventories through April are up 80 (million barrels) since the beginning of the year, raising market concerns about the efficacy of OPEC market management," said U.S. bank Jefferies.

"We remain of the view that inventories will draw by 1.5 million bpd in the second half (of 2017), but empirical evidence of this is likely necessary for oil prices to inflect into an upward trend," it added.

Asian stocks rise, oil languishes near 10-month low on glut fears

Asian stocks advanced on Thursday, but oil futures hovered near a 10-month low hit overnight on concerns over a supply glut and falling demand.

European stocks were mixed with financial spreadbetter CMC Markets expecting Britain's FTSE 100 (FTSE) to open up 0.1 percent, Germany's DAX (GDAXI) to be little changed and France's CAC 40 (FCHI) to start the day down 0.1 percent. All three closed in negative territory on Wednesday.

MSCI's broadest index of Asia-Pacific shares outside Japan (MIAPJ0000PUS) climbed 0.7 percent.

Japan's Nikkei (N225) rose almost 0.1 percent. Shares in auto air bag-maker Takata Corp plunged 50 percent as they exchanged hands for the first time since sources said last week it was preparing to file for bankruptcy.

South Korea's KOSPI (KS11) added 0.3 percent, while Australian shares (AXJO) jumped 1 percent. Taiwan shares (TWII) hit a 27-year high.

Chinese shares added to gains made on Wednesday after MSCI included mainland shares in its emerging market indexes. The blue-chip index (CSI300) rose 1.3 percent. Hong Kong's Hang Seng (HSI) climbed 0.5 percent.

Crude oil was subdued as investors' doubts that OPEC-led output cuts would dent a three-year glut offset data showing a drop in U.S. inventories.

"The time for contrarian trades in oil is fast approaching, but I would want to see some stability in price and the technicals start to become more convincing," said Chris Weston, chief market strategist at IG in Melbourne.

U.S. crude futures (CLc1) slipped almost 0.1 percent, or 3 cents, to $42.50 a barrel. They closed down 1.6 percent on Wednesday after touching their lowest level since August.

Global benchmark Brent (LCOc1) lost 0.1 percent, or 5 cents, to $44.77. It closed down 2.6 percent on Wednesday after touching a seven-month low.

The resulting decline in oil shares hit Wall Street overnight.

The Dow Jones Industrial Average (DJI) closed down 0.3 percent, while the S&P 500 (SPX) was slightly lower. Nasdaq (IXIC) bucked the trend to end up 0.7 percent, lifted by biotech stocks.

Financial stocks also contributed to losses on Wall Street, driven lower by a drop in the Treasury yield curve to its flattest in almost a decade, as investors tried to reconcile a hawkish Federal Reserve with deteriorating inflation measures.

Boston Fed President Eric Rosengren and Fed Vice Chair Stanley Fischer suggested they are concerned less about raising rates too fast or too high than about keeping them too low for too long.

The yield curve between five-year notes and 30-year bonds flattened to 95 basis points, the narrowest since December 2007, on Thursday.

The dollar eased, falling 0.2 percent to 111.145 yen .

The dollar index (DXY) was about 0.1 percent lower at 97.487, extending Wednesday's 0.2 percent loss.

The New Zealand dollar gained 0.5 percent to $0.7257 after the central bank left its interest rate unchanged at a record low as expected and reiterated it would remain steady for a while.

Sterling was steady at $1.2674, holding Wednesday's 0.3 percent gain on comments by the Bank of England's chief economist that he was likely to vote for an interest rate hike this year. Until now, he has been seen as largely supportive of keeping rates low.

The euro was flat at $1.117, after Wednesday's 0.3 percent gain.

The weaker dollar lifted spot gold 0.5 percent to $1,252.80 an ounce.

Oil prices fall further with glut concerns persisting

Oil turned lower on Thursday after posting gains earlier in the session as traders look ready to test new lows for crude prices with worries persisting over a global glut.

Brent crude futures were down 15 cents at $44.67 a barrel at 0715 GMT, after spending much of the Asian trading day in positive territory. They fell 2.6 percent in the previous session to their lowest since November.

U.S. crude futures were down 14 cents $42.39 a barrel, after also spending much of the day trading higher. On Wednesday, they settled down at $42.53, after touching their lowest intraday level since August 2016.

Since peaking in late February, crude has dropped around 20 percent, with only brief rallies, completely erasing gains at the end of the year in the wake of the initial OPEC-led production cut.

The Organization of Petroleum Exporting Countries (OPEC) and other producers agreed to cut output by 1.8 million barrels per day from January for six months, subsequently extended for a further nine months.

"The market didn't actually buy into the cut for fundamental reasons. It bought into it because it was a shift in strategy from OPEC and it gave the market hope," said Matt Stanley, fuel broker at Freight Investor Services in Dubai.

"But (OPEC) didn't do enough and ... other producers were always going to fill the void," he said.

With output rising in Nigeria and Libya, countries exempt from the deal, and output surging in the United States, which was not part of the agreement, many bulls appear to have thrown in the towel.

The market largely shrugged off comments overnight from Iran's oil minister that members of OPEC are considering deeper cuts in production.

A bigger-than-expected cut in U.S. crude stockpiles reported overnight is also barely shifting the dial.

Crude inventories fell 2.5 million barrels in the week to June 16, surpassing analyst expectations for a decrease of 2.1 million barrels, as imports rose marginally by 56,000 barrels per day, the U.S. Energy Information Administration said on Wednesday.

Gasoline stocks fell 578,000 barrels, compared with analyst expectations for a seasonally unusual 443,000-barrel gain, which had been seen as bearish in the market.

Stocks of the motor fuel had also risen unexpectedly by 2.1 million barrels in the previous week, despite the start of the summer driving season.