There was no US economic data released overnight after the weekly mortgage applications index was delayed until next week. In Europe loans to the private sector in November were 2.0pct higher than a year ago - exceeding forecasts for a gain of 1.5pct.

European shares rose again on Wednesday with shares on track to the best monthly gain in 17 months. The FTSEurofirst index rose by 0.2pct, with the German Dax up 0.3pct and France´s CAC40 rose 0.8pct. But the UK FTSE lost 0.2pct. In London trade shares in Rio Tinto lost 0.5pct after the miner declared force majeure on some coal contracts due to floods in Queensland. But shares in BHP Billiton rose by 0.2pct.

US sharemarkets rose again on Wednesday in another session dominated by extremely thin trading volumes. Severe cold weather together with end-year holidays have combined to crimp trade. The Wall Street Journal reported that Blackstone made a preliminary offer for Centro Properties Group´s 600 shopping centres. At the close of trade, the Dow Jones was higher by 9.8pts or 0.1pct with the S&P 500 up 0.1pct and the Nasdaq was higher by 4pts or 0.2pct. The S&P 500 is on track to the best December result since 1991.

US treasuries rebounded on Wednesday (yields lower) as investors scooped up bargains after the previous day sell-off. A strong seven-year auction added momentum to the rally together with end-year book-squaring activity. US 2yr yields fell by 11pts to 0.637pct while US 10yr yields fell by 14pts to 3.347pct.

The US dollar fell against major currencies after investors embraced growth assets. The Euro rose from lows near US$1.3110 to US$1.3235, and was trading near US$1.3220 in late US trade. The Aussie dollar rose from lows of around US101c to a 28-year high of US101.83c, and was trading near the highs in late US trade. The Aussie also lifted to 25-year highs against Sterling and 21-year highs against the Euro (and previous equivalents). The Japanese yen also strengthened from 82.30 yen per US dollar to around JPY81.60 and was holding near its strongest levels in late US trade.

US crude oil prices eased in thin trade as traders squared positions ahead of the release of weekly inventory data. The Nymex crude oil contract eased by 37c to US$91.12 a barrel. However prices remained supported by cold temperatures in the northern hemisphere (boosting demand for heating oil) and a weaker US dollar.

Base metal prices were generally higher on the London Metal Exchange on Wednesday, the exception being nickel, down 1.2pct. Lead rose 4.4pct with zinc up 3.9pct, aluminium rose 1.7pct and copper was up 0.5pct to record highs. The gold price followed base metals higher, boosted in large part by a weak greenback. Comex gold futures rose by US$7.90 an ounce to US$1,413.50 after earlier hitting highs of US$1,414.90.

Ahead: In Australia no economic data is released. In the US weekly data on jobless claims is released.

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