Australian Stock Market Report - Morning
The US ISM manufacturing index rose from 56.6 to a seven month high of 57.0 in December. It was the 17th month of expansion (reading above 50) for the manufacturing sector. But while orders rose, employment softened. And US construction activity rose by 0.4pct in November to a five-month high.
European shares made a solid start to the new year, underpinned by encouraging economic data. The Markit Eurozone PMI rose from 55.3 to 57.1 in December, near 4-year highs. The FTSEurofirst index rose by 1.0pct, with the German Dax up 1.1pct and the French CAC40 up 2.5pct while the UK FTSE was closed for the new year´s day holiday. Automakers made solid gains after a US federal judge dismissed a lawsuit against Porsche. Shares in Porsche rose 15pct.
US sharemarkets spiked higher at the start of trade on Monday before drifting sideways and then weakening slightly into the close. Technology stocks led the way with the Nasdaq 100 index hitting a 10-year high. Shares in Apple were up 2.2pct to record highs. At the close of trade, the Dow Jones was up by 93pts or 0.8pct with the S&P 500 higher by 1.1pct and the Nasdaq was up by almost 39pts or 1.5pct. The broader S&P 500 had its best December in 19 years and lifted 12.8pct in 2010.
US treasuries eased on Monday (yields higher) after finishing firmer on Friday. US 2yr yields were steady near 0.61pct after falling 3.5pts on Friday. US 10yr yields rose by 5pts to 3.34pct on Monday after falling 7pts on Friday.
Major currencies were mixed against the greenback in European and US trade on Monday. The Euro rose from lows near US$1.3250 to US$1.3390, before easing to US$1.3350 in late US trade. The Aussie dollar broadly traded between US101.55c to US102.15c, and was near the lows in late US trade. The Aussie hit fresh 28-year highs of US102.50c around 3am Sydney time on Saturday morning. The Japanese yen eased from 81.20 yen per US dollar to around JPY81.70 and was holding near these levels in late US trade.
US crude oil prices rose modestly to 27-month highs on Monday. Encouraging manufacturing data provide support for prices together with predictions of more harsh winter weather later in the month. But the US dollar was mixed against major currencies. The Nymex crude oil contract rose by US17c or 0.2pct to US$91.55 a barrel.
Base metal prices rose between 0.6pct to 1.9pct on the London Metal Exchange on Friday in response to a weaker US dollar. Nickel and zinc both rose by 1.9pct with lead up 1.5pct. Aluminium was weakest, up 0.6pct. The base metal market was closed on Monday. And the gold price rose on Monday with the Comex gold futures price higher by US$1.50 an ounce to US$1,422.90.
Ahead: In Australia the Performance of Manufacturing index is released. In the US auto sales and factory orders data is scheduled.
More from IBT Markets:
Subscribe to get this delivered to your inbox daily
Follow us on Twitter.
Follow us on Facebook.