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Gasoline Gains on Holiday Sales, Europe Debt Crisis Efforts

Gasoline futures surged as equities jumped after sales in the U.S. reached a Thanksgiving holiday record and the dollar declined on speculation European leaders will step up efforts to control the region’s debt crisis.

Futures rose 2.1 percent after the National Retail Federation reported yesterday that holiday sales gained 16 percent. The dollar sank against the euro, boosting the appeal of raw materials, after German Finance Minister Wolfgang Schaeuble urged fast-track treaty changes to tighten budget discipline.

“Equities are up and the dollar is weak, and we’re getting positive economic sentiment from the fact that sales are up,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut.

Gasoline for December delivery increased 5.16 cents to $2.5005 a gallon at 12:45 p.m. on the New York Mercantile Exchange. Futures rose after sliding Nov. 25 to the lowest level since February.

Gasoline narrowed gains after touching $2.5471, the highest intraday price since Nov. 22, on concern that economic growth may slow.

Morgan Stanley cut its forecast for 2012 global economic growth to 3.5 percent from 3.8 percent, citing an “anemic” expansion in the U.S. and a recession in Europe.

Slower Growth

The Organization for Economic Cooperation and Development said growing doubts about the survival of Europe’s monetary union have stalled global growth and represent the main risk to the world economy. The 34 OECD nations will grow 1.9 percent this year and 1.6 percent next, down from 2.3 percent and 2.8 percent predicted in May, the Paris-based organization said.

“There’s optimism that Europeans are attempting to throw money at the problem, but doubts whether the problems will actually go away,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “There’s reports revising downward economic forecasts that are tempering the enthusiasm.”

The dollar fell 0.6 percent against the euro at 12:47 p.m. in New York. The MSCI All-Country World Index (MXWO) added 3.1 percent and the Standard & Poor’s 500 Index rallied 2.9 percent, halting a seven-day losing streak.

Gasoline’s surge was part of a broader rally in commodities. The S&P GSCI Index of 24 raw materials rose 0.9 percent at 12:47 p.m. in New York.

Retail sales totaled $52.4 billion during the holiday weekend and the average shopper spent $398.62, up from $365.34 a year earlier, the Washington-based National Retail Federation said, citing a survey conducted by BIGresearch.

Brussels Meeting

Euro-area finance ministers will meet in Brussels tomorrow as governments attempt to regain the confidence of financial markets after a week in which the euro-area sovereign debt crisis worsened.

German newspaper Welt am Sonntag reported Chancellor Angela Merkel and French President Nicolas Sarkozy would start a coalition of euro-zone members that would commit to greater fiscal discipline without waiting to change EU treaties. The deal would expect the European Central Bank to take a more aggressive role in fighting the debt crisis.

“They proposed their most wide-reaching integration package yet, which gives some sort of ECB role,” said Ray Carbone, president of Paramount Options Inc. in New York. “You’re probably looking at a market that was massively short. There’s not a lot of concreteness to this proposal but it’s enough to make people cover their shorts.”

December-delivery heating oil advanced 3.54 cents, or 1.2 percent, to $2.9627 a gallon.

Regular gasoline at the pump, averaged nationwide, declined 0.5 cent to $3.295 a gallon yesterday, according to AAA data.

To contact the reporter on this story: Barbara J Powell in Dallas at bpowell4@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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