* China HSBC flash PMI at 3-mth high, signals recovery
* U.S. crude stockpiles rose slightly last week -API
* Brent to fall towards $105.35 -technicals
* Coming Up: Federal Reserve policy decision; 1815 GMT
By Manash Goswami and Florence Tan
SINGAPORE, Oct 24 (Reuters) – Brent crude futures climbed
towards $109 a barrel on Wednesday, snapping a six-day losing
streak after economic data from China suggested a strengthening
recovery in the world’s No. 2 oil consumer.
China’s manufacturers saw growth shrink for a 12th
successive month in October, but output stood at a three-month
high and order books were the most robust since April,
preliminary results of a purchasing managers survey showed.
The data helped allay concerns that the global economy may
be slowing faster than previously expected, as a recent spate of
poor U.S. corporate earnings and outlooks had indicated.
Brent crude had risen 46 cents to $108.71 a barrel
by 0239 GMT. It fell for a sixth straight session on Tuesday,
when it hit an intraday low of $107.31, the weakest since Sept.
20 and below its 100-day moving average at $107.42.
U.S. oil gained 44 cents to $87.11, snapping a
four-day decline. The front-month contract slumped more than 3
percent on Tuesday to touch a session-low of $85.69, the lowest
since July 13.
“The PMI data is supportive for commodities and I expect the
crude market to be buoyant,” said Ker Chung Yang, senior
investment analyst at Phillip Futures Pte Ltd.
“The upside for oil has been dampened by global economic
concerns in Europe and China. But the upbeat PMI data from China
is relieving concerns of slower growth.”
Oil prices have been under pressure in the past few days
because of a weak demand outlook, although fears of possible
supply disruption due to unrest in the Middle East have lent
some support.
Faced with weakening revenue, three of the largest U.S.
companies, including Dow Chemical Co, warned on Tuesday
that they would cut jobs to protect profits.
But technical charts suggest Brent could end its current
modest rebound and fall again towards $105.35, while U.S. oil
may pull back towards resistance at $87.70, before falling again
to $85.19, according to Reuters technical analyst Wang Tao.
Further price gains were capped by data showing U.S. crude
oil inventories rose slightly last week, according to the
American Petroleum Institute. Crude inventories increased by
313,000 barrels in the week to Oct. 19, according to the API,
compared with an analyst forecast for an increase of 1.9 million
barrels in total.
“Growing oil stocks and weak demand sentiment appear to have
offset Middle East tight supply worries, with a threat by Iran
to curtail oil exports in response to tighter sanctions,”
analysts at ANZ said in a report.
(Editing by Manolo Serapio Jr. and Joseph Radford)
