US jobless claims fell by 15,000 to 358,000 last week - against expectations of a rise and signalled the ongoing improvement in the labour market. US wholesale inventories grew by a larger than expected 1pct in December - suggesting the economy received a bigger boost than expected in the fourth quarter from companies restocking their shelves. The result could result in upward revisions to US fourth quarter GDP released at the end of February.

The European Central Bank left its key policy rate unchanged at 1pct overnight. Indeed there was not even a discussion of a potential rate cut at the meeting. In fact ECB president Draghi commented that he no longer sees ´´substantial´´ downside economic risks and re-iterated the belief that the first 3-year LTRO had helped the Euro-zone to avoid a deep credit crunch. But he did admit that its impact on bank funding was still unfolding.

European shares rebounded on Thursday following the prior three sessions of losses. Encouraging US data and confirmation of an austerity package agreed by Greek policymakers supported investor sentiment. Cyclical stocks received a boost with the automotive index gaining 3pct. The FTSEurofirst index rose by 0.2pct, with the UK FTSE gained 0.3pct and the German Dax rose by 0.6pct.

US sharemarkets ticked higher on Thursday after Greece reached a deal to secure additional funding. However investors were cautious after the recent rally. At the close of trade, the Dow Jones was up by 7 points or 0.1pct. The S&P 500 was up 0.2pct and the Nasdaq was up by 11pts or 0.4pct.

US treasuries fell on Thursday (yields higher) following confirmation that Greece had agreed to terms of the bailout package. However a $16 billion auction of 30-year bonds met healthy demand with a bid-cover ratio of 2.47. US 2yr yields were up 1pt to 0.269pct and US 10yr yields rose 6pts to 2.045pct.

The Euro rallied to a two-month high against the US dollar on Thursday. The Euro rose from lows near US$1.3230 to US$1.3315, and was near US$1.3280 in late US trade. The Aussie dollar hit early highs near US108.25c, before falling to US107.80c and was near US107.85c in late US trade. And the Japanese yen held between 77.10 yen per US dollar and JPY77.75 and was near JPY77.65 in late US trade.

World crude oil prices rose for a third consecutive day on Thursday following the upbeat US jobless claims data. The US Nymex oil price was up US$1.13 to US$99.84 a barrel and London Brent crude rose by US$1.39 to US$118.59 a barrel.

Base metal prices were mostly higher on Thursday. Most metals rose 0.1-2.3pct with copper touching a five-month high on the improving economic landscape. And the gold price rallied on Thursday supported by the weakness in the US dollar. Comex April gold rose by US$9.90 or 0.6pct to US$1,728.79 an ounce.

Ahead: In Australia, the Reserve Bank releases its Statement on Monetary Policy. Earnings are expected from Newcrest Mining. In the US trade data is released.