US open: Figures on industrial production offset weakness in crude

US stocks retreated early on Monday despite a better than expected reading on US industrial production which showed activity in the sector at its highest since May 2010.

As of 15:50 the Dow Jones Industrials was lower by 0.03%, the S&P 500 by 0.02% and the Nasdaq by another 0.25%.

West Texas crude futures slipped 1.63% to $56.92 per barrel on Monday.

Over the weekend two Libyan oil terminals were closed due to a break-out of fighting. That supported early gain in Brent which by late afternoon had petered out.

The 1.3% month-on-month rise in US industrial production for November “shows that the strengthening in domestic demand is offsetting the effects of the weakening global backdrop and the stronger dollar,” according to senior US economist for Capital Economics Paul Dales.

The dollar was rallying against the pound, the euro and the yen early on Monday.

Dales added: “Mining output fell by 0.1% m/m, which could be a sign that the squeeze from lower oil prices is underway. But manufacturing output rose by a strong 1.1% m/m and October’s 0.2% m/m rise was revised up to +0.4%.

“Looking ahead, the survey evidence has been very mixed. But we suspect that stronger domestic demand will ensure that manufacturing output continues to grow by around 5% a year.”

In the corporate world, Applied Materials, Apache, Anadarko Petroleum, AES, Nabors Industries, and Range Resources were all advancing following the news in both industrial and energy sectors.