US industrial production rose by 0.4pct in December, slightly below expectations but a rebound from the 0.3pct fall in November. US producer prices fell 0.1pct in December but the core rate (excludes food and energy) surprisingly rose by 0.3pct, ahead of forecasts for a 0.1pct gain. The NAHB housing index rose from +21 to a 4-1/2year high of +25 in January.

Germany sold 3.44 billion of euros of 2-year bonds at a yield of 0.17pct. The bid-cover was healthy at 2.2 versus 1.43 at the last auction. Portugal sold 2.5 billion euros of 3-month, 6-month and 11-month bills. Encouraging yields achieved were all below 5pct.

According to ´´international financial sources´´ the International Monetary Fund is seeking to raise $600 billion from member councies to help nations affected by the euro zone debt crisis.

European shares edged up to fresh 5-1/2 month highs on Wednesday. Investors cautiously watched debt negotiations in Greece while euro-zone debt auctions were better-than-expected. The FTSEurofirst index rose by 0.02pct with the UK FTSE up by 0.2pct and the German Dax up by 0.3pct.

US sharemarkets rose on Wednesday. Financials were higher following better-than-expected earnings from Goldman Sachs. Shares in Goldman Sachs rose by 7.1pct. At the close, the Dow Jones finished near its highs, up by 97pts or 0.8pct, with the S&P 500 up 1.1pct and the Nasdaq rose by 41pts or 1.5pct.

US long-term treasuries fell on Wednesday (yields higher) as encouraging news on the economy and European debt auctions led investors to favour equities over bonds. US 2yr yields were flat at 0.23pct and US 10yr yields rose by 5pts to 1.90pct.

The greenback was mixed against major currencies in US and European trade as investors weighed up economic and debt market news. The Euro rose from lows near $1.2735 to around US$1.2860 and was near US$1.2855 in late US trade. The Aussie dollar held between near US103.55c and US104.30c, and was near the highs in late US trade. And the Japanese yen eased from 76.64 yen per US dollar to JPY76.87, and was near JPY76.77 in late US trade.

World crude oil prices eased on Wednesday. Geopolitical tensions in Iran and Nigeria continue to ease, reducing supply concerns. And the International Energy Agency cut its 2012 demand growth forecast by 220,000 barrels per day (bpd) from its previous monthly report to 1.1 million bpd. Nymex crude oil fell by US12c or 0.1pct to US$100.59 a barrel while London Brent crude fell by US87c to US$110.66 a barrel.

Base metals were mixed on Wednesday. Aluminium, nickel and zinc eased while other metals rose, with lead posting the strongest gain, up 1.5pct. And the gold price rose for a second day, hitting a five-week high as the greenback eased. The Comex February gold price was up by US$4.30 an ounce or 0.3pct to US$1,659.60 an ounce.

Ahead: In Australia, monthly employment data is released. In the US, consumer prices, housing start, weekly jobless claims and the Philadelphia Fed business index are all released.