US jobless claims rose by 2,000 to 439,000 over the past week. However the four week moving average of claims - a better gauge of underlying labour trends - hit the lowest level since September 2008. The number of people still receiving unemployment benefits after an initial week of aid held at a two year low of 4.3 million.

The US Philadelphia Fed Manufacturing Index surged from 1.0 to 22.5 in November - well ahead of expectation and the highest reading in 11 months. Any reading above zero indicates an expansion in the regions manufacturing. The US leading economic index rose by 0.5pct.

European shares rallied for a second straight session on Thursday. Ireland´s move to work with a EU-IMF mission to support the banking sector was viewed with optimism by investors. Higher metals prices provided support to mining stocks with BHP shares rising 1.3pct and Rio Tinto gaining 3.2pct. The FTSEurofirst index gained 1.4pct, the UK FTSE rose 1.3pct and the German Dax rose 2.0pct.

US sharemarkets surged on Thursday as the better than expected US manufacturing data and improving labour market conditions provided a catalyst for a strong turnaround. General Motors relisted at US$33 and found strong demand rising 3pct. Ireland bailout hopes added further strength to markets. At the close of trade, the Dow Jones was higher by 170pts, the S&P 500 gained 1.5pct and the Nasdaq rose by 38pts or 1.5pct.

US treasuries fell (yields higher) on Thursday as the improved economic outlook resulted in investors willing to take on more risk. US 2yr yields rose 1pt to 0.50pct and US 10yr yields rose 2pts to 2.90pct.

The Euro was on track for its biggest one day gain against the US dollar in two weeks, as investors became more optimistic about a rescue plan for Ireland. The Euro rose from lows near US$1.3580 to US$1.3655, heading into the US close near US$1.3630. The Aussie dollar rose from lows near US98.3c to US98.99c, heading into the US close near US98.85c. And the Japanese yen is currently around 83.50 yen per US dollar after trading from JPY83.10 to JPY83.75.

US crude oil prices rose for the first time in five sessions. The rally in equity markets and weakness in the US dollar supported the demand for oil. The Nymex crude oil contract rose US$1.41 to US$81.85 a barrel.

Base metal prices recorded strong gains on the London Metal Exchange as the upbeat US manufacturing data added to investor optimism. Copper gained 2.7pct, while other metals rose by 1.4pct-3.3pct. And the gold price rebounded, with Comex gold futures up US$16.00 an ounce to US$1,353.00.

Ahead: In Australia, state national accounts are released. In the US no economic data is released.

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