Australian Stock Market Report - Morning
The US Philadelphia Fed index rose from -0.7 to 1 in September. Despite still being weak sub indices including new orders, shipments and employment all improved. The US leading economic index rose from 0.1pct to 0.3pct in September. Five out of the ten separate measures of activity strengthened in September.
US jobless claims fell 23,000 to 452,000 in the last week. Data for the prior week was revised up to 475,000 from a prior estimate of 462,000. The four-week moving average of new claims - a more accurate gauge of employment trends - also fell, dropping 4,250 to stand at 458,000.
European shares surged to six-month closing highs on Thursday. Solid earnings results supported the bid for equities. The FTSEurofirst index rose by 0.6pct with the UK FTSE up 0.5pct and the German Dax gained 1.3pct.
US sharemarkets recorded modest gains in a volatile trading session on Thursday. Upbeat earnings results from blue chips including McDonalds buoyed optimism before the rally in the US dollar saw investors lock in some of the recent gains. The Dow Jones rose by 39pts or 0.4pct with the S&P 500 up 0.2pct and the Nasdaq lifted 2pts or 0.1pct.
US long dated treasuries fell (yields higher) on Thursday. The speculation on a further round of quantitative easing continued to be the driving factor as traders took bets that it was unlikely that the US fed would buy long dated treasuries. US 2yr yields were flat at 0.351pct, while US 10yr yields rose by 8pts to 2.55pct.
The US dollar strengthened against major currencies in a volatile trading session. The Euro fell from highs near US$1.4040 to US$1.3905, ending US trade near US$1.3920. The Aussie dollar fell from highs around US98.85c to almost US97.45c, ending US trade near US97.80c. And the Japanese yen traded between 80.90 yen per US dollar to JPY81.35, ending US trade near JPY81.30.
US crude oil prices gave back part of the previous session's gains on Thursday. The rebound in the US dollar added to the sell-off in commodities. The Nymex crude oil contract fell by US$1.21 or 1.5pct to US$80.56 a barrel. London Brent crude fell $1.90 to $81.70 a barrel.
Base metal prices were mixed on the London Metal Exchange on Thursday as the recovering US dollar drove market activity. Nickel lost 1.6pct, while lead gained 1.5pct. And similarly the gold price eased in line with the strength in the US dollar. Comex gold futures price fell by US$18.80an ounce or 1.4pct to US$1,324.75.
Ahead: In Australia, import and export price data are released. In the US no economic data is released. The G20 finance meeting takes place over the next three days.
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