US consumer prices rose by a surprising 0.5pct in July. Over the year the headline measure rose by 3.6pct largely due to the sharp rebound in gasoline prices. In fact core CPI rose by a more sedate 0.2pct in July and 1.8pct over the year. US initial jobless claims nudged higher to 408,000 in the past week.

The Philadelphia Fed survey of manufacturing collapsed in August, plunging by 33.9 points to -30.7. The result marked the weakest reading since early 2009. The sub components were all substantial lower. US existing home sales fell by 3.5pct in July.

European shares recorded their biggest daily fall in over 2½ years on Thursday. Doubts about the global recovery and sovereign debt issues continued to dominate price action. Concerns about bank funding also gained traction after an unidentified euro zone bank borrowed $500 million in one-week dollars from the ECB. The Euro banking sector falling by 6.7pct. The STOXX 600 basic resources index lost 6.9pct. The FTSEurofirst index fell by 4.8pct and the German Dax was down by 5.8pct while the UK FTSE fell by 4.5pct.

[Kick off your day with our newsletter]

US sharemarkets fell in a volatile trading session on Thursday. Weak economic data added to earlier fears about another recession. A Wall Street Journal report citied that the Federal Reserve was taking a closer look at the US units of Europe´s biggest banks, concerned that the European debt crisis could spill into the US banking system. A weaker-than-expected earnings result from Hewlett Packard weighed on technology stocks. The Dow Jones lost 419pts or 3.7pct while the S&P 500 fell 4.5pct and the Nasdaq gave back 131pts or 5.2pct.

US long-term treasuries rose again on Thursday (yields lower) as fears about global growth drove demand for safe-haven treasuries. US 2yr yields were flat at 0.194pct while US 10yr yields fell by 9pts to 2.07pct.

Major currencies fell against the greenback over the European and US sessions. The Euro fell from US$1.4450 to US$1.4275, ending the US session at US$1.4330. The Aussie dollar fell from US105.05c to US103.55c, ending US trade near US104.00c. And the Japanese yen lifted from 76.70 yen per US dollar to JPY76.45, ending US trade near JPY76.55.

Global crude oil prices fell sharply on Thursday. Investors sold off commodities and equities on heightened fears about global economic growth. Nymex crude oil fell by US$5.20 or 5.9pct to US$82.38 a barrel and London Brent crude fell by US$3.61 to US$106.99 a barrel.

Base metal prices were lower on the London Metal Exchange on Thursday following the slide in the oil price. The stronger US dollar added to the weakness in base metals. And the gold price edged up to fresh record highs with Comex December gold up by US$28.20 an ounce to a record US$1,822.

Ahead: In Australia, no economic data is expected. Earnings are expected from QBE, Fortescue metals, Santos and Billabong. In the US, no economic data is released.