US retail sales rose by 0.4pct in March, after an upwardly-revised gain of 1.1pct in February (previously +1.0pct). Economists had tipped a 0.5pct increase in sales. Excluding autos, sales were up 0.8pct. Excluding gasoline, sales were up 0.1pct. Total retail sales are up 7.1pct on a year ago (ex autos up 6.5pct) - well ahead of the pace in Australia.

According to the Federal Reserve Beige Book, the US economy continued to improve over the past month, led by strength in manufacturing. But firms noted higher energy and raw material costs as an area of concern. Housing markets were little changed, with activity weak.

US President Barack Obama has outlined plans for reducing the US budget deficit by $4 trillion over 12 years.

European shares rebounded on Wednesday with banking stocks higher in the wake of good earnings results from JP Morgan. The STOXX Europe Banks index rose 0.6pct. The FTSEurofirst index rose by 0.7pct while the German Dax gained 1.1pct and the UK FTSE rose by 0.8pct.

US sharemarkets posted modest gains on Wednesday with early strength on the back of higher earnings from JP Morgan failing to extend for the full session. The Dow Jones index rose by 7pts or 0.1pct, with the S&P 500 up just 0.25points or less than 0.1pct and the Nasdaq gained 16.7pts or 0.6pct.

US treasuries rose on Wednesday in choppy trade (yields lower) in response to US President Obama´s plan to cut the federal budget deficit. US 2yr yields fell by 3pts to 0.73pct and US 10yr yields lost 4pts to 3.46pct.

The US dollar was mixed against major currencies in the European and US sessions on Wednesday. The Euro eased from US$1.4520 to US$1.4415 before ending US trade at US$1.4435. The Aussie dollar traded between US104.65c to US105.35c, ending near US105.00c. And the Japanese yen strengthened from lows around 84.25 yen per US dollar to near JPY83.55, closing US trade near JPY83.75.

US crude oil prices rose for the first time in three days with the Nymex crude oil contract up by US86c or 0.8pct to US$107.11 a barrel. The London Brent crude rose by US$1.96 to US$122.88 a barrel. Data showed that US gasoline inventories fell by 7 million barrels last week, the biggest drop since October 1998.

Base metal prices eased again on the London Metal Exchange on Wednesday, falling between 0.4-1.9pct. Aluminium fared best but lead and zinc posted the biggest declines. But the gold price rose modestly in response to a higher oil price. The Comex gold futures price rose by US$2.00 an ounce to US$1,455.60 after ranging from US$1,452.00 to US$1,463.70 an ounce.

Ahead: In Australia, data on car sales and detailed job market figures are issued. In the US, data on producer prices is released.

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