Energy futures gained yesterday after failed labor talks between Norway’s oil workers and their employers over pay. The country is now thought to be close to its first complete shutdown of its oil industry in over 25 years. The Norwegian government is expected to step in but has yet failed to do so. Elsewhere Chinese inflation was seen to be cooling in July which could entice policy makers to further ease without having to stoke inflationary concerns. Turning to last night’s closing levels, Brent crude closed out the session at $100.32 up $2.13. WTI crude closed at $85.99 up $1.54. Gasoil closed at $873.75 up $5.00, while UK Nat Gas closed at £57.84 up £0.99.

The Euro is currently extending its move to the downside after holding steady last night as equities fell. It hit a high of 1.2320 during the Asian session and we are currently just above the lows of the day at 1.2280. Euro-Zone finance ministers agreed to give Spain an extra year to cut its deficit to 3% while Mario Draghi has left the door open to a further cut I Euro-Zone interest rates if economic conditions continue to worsen. Currently priced at 1.2280 we see next resistance at 1.2365 and 1.2400 in extension. On the downside we draw support at 1.2230 and again at 1.2190.

Equities closed lower yesterday more so in the US than in Europe as earnings season kicked off to a negative tone. Earnings for the last quarter are expected to be worse than expected and that is showing from the closing levels. In Europe the FTSE closed at 5627.33 down 35.30 while the DAX which also declined yesterday has just opened down a further 17.0 at 6381.0. In the US the DJIA closed at 12736.29 down 36.18 while the S&P closed at 1352.46. Gold is trading at 1586.00 while Silver is at 27.275. The VIX rose 5.15% to close at 17.98.

In economic data today we have a very light day with nothing out of Europe at all. In the UK we have Industrial Production data and later on NIESR GDP estimates. In the US we have nothing save Small Business Optimism which on a fuller day data wise would not merit a mention. Tonight we also have the API Inventory Report.

For Brent crude we draw first resistance at $99.50, followed by $100.30. On the downside we draw first support at $98.00, followed by $97.00.

For Gasoil we draw first resistance at $874.00, followed by $879.00. On the downside we draw first support at $865.00, followed by $860.00.

Jaime Miralles