LONDON (SHARECAST) - Crude oil futures settled over 1 per cent lower on Tuesday as market winced at weaker than expected US manufacturing data.
The Institute for Supply Management said its manufacturing index fell to 49.6% in August, marking a third consecutive month of declines and compares with 49.8% in July. August's reading is the weakest in three years.
Analysts had expected the reading to be slightly above 50% and anything below 50% indicates a contraction.
After spending much of the day moving between positive and negative territory, crude for October delivery fell $1.17 at $95.30 a barrel on the New York Mercantile Exchange.
Oil had traded at a high of $97.37 a barrel earlier in the session as investors cheered comments from European Central Bank President Mario Draghi, ahead of an ECB policy meeting Thursday, about purchasing 3-year government bonds to reduce borrowing costs for debt struck Eurozone countries.
However the US manufacturing data, along with Monday's disappointing Chinese and European manufacturing reports and the dollar's strength, wiped the shine off earlier gains.
On the ICE futures exchange Brent crude declined $1.37 at $114.41 a barrel.
Gold's allure was boosted further on Tuesday with the precious metal striking a 5-month high as investors increasingly bet that the US Federal Reserve will announce another round of quantitative easing (QE) to stimulate growth.
Gold for December delivery advanced $8.40 to close the session at $1,696 an ounce on the Comex division of the New York Mercantile Exchange. Earlier in the session it struck a high of $1,701.60 an ounce.
Elsewhere silver made headway, with the December contract rising 97 cents to reach $32.41 an ounce.
Palladium for December delivery advanced $12.05 to settle at $641.45 an ounce as the strike in South Africa continues.
Platinum for October delivery bounced $30.20 to $1,567.50 an ounce.
LONDON (SHARECAST) - Crude oil futures settled over 1 per cent lower on Tuesday as market winced at weaker than expected US manufacturing data.
