US jobless claims rose by 19,000 in the latest week to 464,000, above expectations for a result near 445,000. The US leading index fell by 0.2pct in June, better than forecasts centred on a decline of 0.3pct fall. And US existing home sales fell by 5.1pct to an annual rate of 5.37 million in June - a better result than expectations that had centred on a 8.1pct decline. The stock of unsold homes stands at 8.9 months.

European shares posted solid gains for a second day in response to strong US corporate earnings. And mining stocks rose again as base metal prices surged. In London trade shares in BHP Billiton rose by 2.4pct and Rio Tinto was up 2.1pct. The FTSEurofirst index rose by 2.1pct with the UK FTSE up 1.9pct and German Dax lifted by 2.5pct.

US sharemarkets recorded solid gains on Thursday in response to strong earnings from economic bellwethers, United Parcel Service and Caterpillar as well as 3M. The Dow Jones rose by 201 points or 2.0pct with the S&P 500 up 2.0pct, and the Nasdaq lifted 58 points or 2.7pct. After the bell Microsoft and American Express reported earnings ahead of consensus forecasts but Amazon fell short.

US long-term treasuries fell on Thursday (yields higher) as strong corporate earnings caused investors to embrace equities at the expense of safe-haven government bonds. US 2yr yields were little-changed at 0.56pct while US 10yr yields rose 5pts to 2.93pct.

The US dollar fell against the Euro and commodity currencies over the European and US sessions. The Euro rose from lows around US$1.2745 to US$1.2925 before ending US trade at US$1.2890. The Aussie dollar soared from lows near 87.45c in European trade to US89.50c, before ending the US session near US89.30c. But the Japanese yen eased from 86.30 yen per US dollar to JPY87.20 before ending US trade near JPY86.95.

US crude oil prices soared to 11-week highs as more optimistic investors embraced equities and commodities. In addition traders were watching the progress of a tropical storm that threatened oil installations in the Gulf of Mexico. The Nymex crude oil contract rose by US$2.74 or 3.6pct to US$79.30. And London Brent crude rose by US$2.45 to US$77.82 a barrel.

Base metal prices posted solid gains on the London Metal Exchange on Thursday in response to solid corporate earnings results and optimism on European banks stress test results. Metals rose by 1.7-4.0pct with lead doing best. And the Comex gold price lifted by US$3.80 an ounce to US$1,195.60. Range was from US$1,180.70 to US$1,201.20.

Ahead: In Australia, data on import and export prices are released. Woodside Petroleum reports quarterly production figures. Results of stress tests on European banks are released at 2.30am Sydney time. There is no major economic data released in the US.