MARKETS VIEW

Crude ends skid, as OPEC leaves production ceiling unchanged Crude futures rose steadily on Friday, halting a midweek slump as OPEC expectedly kept production levels unchanged from their current level at approximately 30 million barrels per day. Although the majority of OPEC's smaller nations have advocated for a slash in production output to boost prices, they have been overruled by Saudi Arabia which is looking to undercut U.S. shale producers by depressing prices. “The reality now is that we cannot have this $100 (a barrel) anymore. This is a fact. We have less value for our barrels,” OPEC secretary general Abdalla Salem el-Badri said at a Friday news conference. Iran, which could release a glut of crude into the global markets over the next several months if longstanding economic sanctions are lifted by Western powers, announced Friday that it is currently producing approximately 3 million bpd. In a span of only five years, Iran is optimistic it can double output to a level of 6 million bpd by 2020. An outflow of Iranian oil into the global markets is considered to be bearish for crude prices, which have been tamped down by a glut of oversupply in recent months. In the U.S., oil services firm Baker Hughes (NYSE:BHI) said that the number of oil rigs nationwide fell last week by four to 642, the lowest level since August, 2010. It marked the 26th consecutive week of weekly rig declines. Dollar-denominated commodities such as crude become more expensive for foreign purchasers when the dollar appreciates. (Source:: Investing.com)

Gold ticks down, as strong U.S. jobs data increases rate hike chances Gold futures ticked down on Friday extending losses from earlier this week, as optimistic U.S. jobs data increased the possibility that the Federal Reserve could raise interest rates sooner than previously expected. Gold prices plunged early on Friday morning after the U.S. Bureau of Labor Statistics released better than expected job figures for the month of May. Last month, U.S. non-farm payrolls soared by 280,000, far exceeding analysts' low end of forecasts for a 220,000 gain. Private payrolls increased by 262,000 in May, as professional business services added 63,000 positions on the month. The labor market also added 17,000 construction positions, following a significant gain of 35,000 a month earlier. While the economy grew at a tepid pace over the last several months, Hawkish members of the Fed argued that temporary drags such as severe winter weather and a West Coast port labor dispute disproportionately restrained growth. The Labor Department also upwardly revised jobs figures for the previous two months further underscoring the Hawkish viewpoints. While the unemployment rate inched up to 5.5% in May, the Labor Force Participation rate also moved higher last month, increasing 0.1% to 62.9%. The Fed's decision to tighten monetary policy is viewed as bearish for gold. The precious metal is not attached to dividends or interest rates and struggles to compete with high-yield bearing assets in periods of rising rates. Separately, Federal Reserve of New York president William Dudley reiterated on Friday that the Fed will likely raise rates at some point this year. It is widely expected that the Fed could wait until September before raising its benchmark Fed Funds Rate, though it has not ruled out lift-off in June. On Thursday, the International Monetary Fund suggested that the Fed should wait until the first half of 2016 for lift-off unless the U.S. economy improves dramatically over the next several months. (Source:: Investing.com)