New US claims for unemployment insurance (jobless claims) fell by 17,000 last week to 421,000. The four-week average of claims fell to fresh two-year lows.

US household wealth rose by US$1.2 trillion (2.2pct) to US$54.9 trillion in the September quarter with household debt falling by 1.7pct. And wholesale inventories rose by 1.9pct in October with sales up by 2.2pct. It was the biggest gain in sales since March and both sales and inventories comfortably beat market expectations.

Sales of passenger cars including multipurpose and sport-utility vehicles in China increased 29.3pct to a record 1.34 million in November.

European shares rose for a fourth straight day to the highest levels in more than two years. A drop in US jobless claims provided further encouragement about expectations for the global economy. The FTSEurofirst index rose by 0.4pct but while the UK FTSE rose by 0.2pct, the German Dax eased by 0.2pct.

US sharemarkets were mixed on Thursday. At the close of trade the Dow Jones was lower by 2 points or less than 0.1pct. The broader S&P 500 rose by 0.4pct while the Nasdaq was higher by 7.5pts or 0.3pct.

US longer-term treasuries rose on Thursday (yields lower) in response to strong demand for a US$13 billion auction of 30-year bonds. Doubts about the passing of legislation to extend the Bush-era tax cuts also buoyed demand for bonds. US 2yr yields were steady at 0.628pct but US 10yr yields fell by 6pts to 3.215pct.

The US dollar lifted further against major currencies on Thursday as optimism continued to grow about prospects for the US economy. The Euro fell from highs near US$1.3315 to US$1.3170, but lifted to US$1.3240 ahead of the US close. The Aussie dollar fells from highs near US98.80c to US98.10c, and was around US98.35c in late US trade. And the Japanese yen held between 83.50 yen per US dollar and JPY84.10, and was near JPY83.70 in late US trade.

US crude oil prices eased from highs on Thursday with a firmer US dollar working to stem the buying support flowing from positive readings on the economy. A stronger greenback reduces the purchasing power of oil buyers in Europe and Asia. Investors also started squaring positions ahead of a weekend meeting of OPEC oil ministers. The Nymex crude oil contract rose by US9c to US$88.37 a barrel, but finished well off highs of US$89.42.

Base metal prices generally eased on the London Metal Exchange on Thursday in response to a stronger US dollar. Nickel lost 1.7pct and copper fell 1.3pct. Lead went against the trend, up 0.1pct. But the gold price lifted on Thursday as US bond yields fell. The Comex gold futures price rose by US$2.40 an ounce to US$1,385.60.

Ahead: In Australia, no major economic data is scheduled. Chinese trade data is released. In the US the trade balance, treasury budget and consumer sentiment figures are released.

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