Australian Stock Market Report – Morning 11/26/13

US MORNING REPORT
(8.00am AEDT)

In US economic news, pending home sales dipped by 0.6pct in October. The Dallas Fed manufacturing index slipped from 3.6 to 1.9 in November.

European shares lifted towards a five year high. The nuclear deal between Iran and the West supported an array of sectors. French carmakers PSA Peugeot Citroen (up 5.1pct) and Renault (up 1.4) - which had significant exposure to the Iranian car market before the tough sanctions against Iran were introduced - recorded strong gains. Travel and leisure stocks rose 1.6pct led by the airlines, as geopolitical tensions eased and the oil price came under pressure. The FTSEurofirst 300 index rose by 0.4pct and the German Dax gained 0.9pct but the UK FTSE rose 0.3pct. In UK trade, shares in BHP Billiton fell by 0.1pct while Rio Tinto lost 0.9pct.

US sharemarkets rose again on Monday, with the Nasdaq composite index lifting above 4,000 points for the first time since September 2000. Trading volumes were light in a holiday shortened week. Energy shares were the weakest, under pressure from the falling oil price. The S&P energy sector lost 0.8pct. At the close of trade left, the Dow Jones was up by 8 points or 0.1pct, with the S&P 500 down by 0.1pct while the Nasdaq lifted 3pts or 0.1pct.

US treasuries rose on Monday (yields lower) as housing data came in slightly weaker than expected in a holiday shortened week. US 2yr yields fell by 1pt to 0.29pct while US 10yr yields were down 1pt to 2.74pct.

The US dollar rallied against the Euro in European and US trade on Monday. The Euro fell from highs near US$1.3545 to lows near US$1.3490 heading into the US close near US$1.3515. The Aussie dollar touched early lows near US91.15c before lifting to highs near US91.70c and ending US trade near US91.60c. And the Japanese yen strengthened from near 101.90 yen per US dollar to JPY101.60, and ended US trade near JPY101.55.

World oil prices fell on Monday as investors focused on the interim nuclear agreement between Iran and Western world powers, which may result in an eventual lift in Iranian oil exports. Brent crude eased by US5c to US$111.00 a barrel while US Nymex crude fell by US75c or 0.8pct to US$94.09 a barrel.

Base metal prices were mostly weaker on the London Metal Exchange on Monday with the exception of Tin (up 0.4pct). Aluminium recorded the biggest declines down 0.5pct while zinc lost 0.4pct. The gold futures price fell on Monday with the Comex December futures gold price down by US$2.90 or less than 0.2pct to US$1,241.20 per ounce. The iron ore price was unchanged at US$136.50 a tonne.

Ahead: In Australia, no major economic data is scheduled. In the US, building permits, housing starts, consumer confidence and the Richmond Fed manufacturing index are released. RBA Deputy Governor Philip Lowe delivers a speech on productivity and infrastructure in Sydney.

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