BUSINESS

Loonie rises amid lower oil prices; traders look to housing, confidence data

11/26/2013 08:42 EST | Updated 01/26/2014 05:59 EST
TORONTO - The Canadian dollar closed higher Tuesday amid weak moves in commodity prices and as the American currency turned in a mixed performance against global currencies.

The loonie was up 0.17 of a cent to 94.97 cents US.

Markets also continued to digest Iran’s deal with six world powers on nuclear development reached over the weekend.

Oil prices initially fell sharply even though the agreement does not loosen sanctions on Iran’s oil exports, but ended the session Monday down just 75 cents.

On Tuesday, the January contract on the New York Mercantile Exchange was off an additional 41 cents to US$93.68 a barrel.

Oil traders are now looking ahead to figures on U.S. crude stockpiles.

Data for the week ended Nov. 22 is expected to show a draw of 1.5 million barrels in crude oil stocks and a build of one million barrels in gasoline stocks, according to a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos.

The report from the Energy Department’s Energy Information Administration — the market benchmark — will be out on Wednesday.

Crude oil supplies rose by 400,000 barrels for the week ended Nov. 15, the ninth straight weekly increase.

December copper was down two cents at US$3.21 a pound while December gold bullion gained $1.60 to US$1,242.80 an ounce.

Investors also looked to U.S. housing and consumer confidence data.

U.S. housing permits jumped to 1.03 million in October, the fastest pace in five years. Most of the growth was centred on apartments while permits for houses remained mostly flat.

U.S. housing starts data for September and October were also to be released Tuesday but the partial U.S. government shutdown in October has delayed that until Dec. 18.

Other data showed that U.S. home prices rose more slowly in September than in August in a sign that weaker sales are preventing the kinds of sharp price gains that occurred earlier this year. The Standard & Poor’s/Case-Shiller 20-city home price index rose 0.7 per cent from August to September.

At the same time, concerns about hiring and pay increases in coming months pushed a key gauge of consumer confidence in the economy to the lowest level in seven months in November.

The U.S. Conference Board says that its index of consumer confidence dropped to 70.4 from 72.4 in October.

The major piece of Canadian economic data comes out on Friday when Statistics Canada issues its gross domestic product readings for September and the third quarter.

The consensus calls for growth to come in at an annualized pace of 2.4 per cent — which would be 0.8 of a percentage point higher than what the Bank of Canada has forecast.