Australian Stock Market Report – Morning 4-9-13

US MARKET CLOSE MORNING REPORT
(6.00am AEDT)

In US economic news, the Chicago Midwest Manufacturing index rose by 0.8pct in February after rising by a revised 0.4pct in January.

European shares rose on Monday although volumes were light. Healthcare stocks led the rally as investors cautiously bought up equities ahead of the US earnings season. German industrial production rose by 0.5pct in February, but January numbers were revised lower to a contraction of -0.6pct. The numbers suggest rough stabilisation of output in the March quarter following a sharp drop in the December quarter. The FTSEurofirst 300 index rose by 0.2pct. The UK FTSE index was higher by 0.4pct while the German Dax rose 0.1pct. Mining shares were mixed with BHP Billiton lower by 0.1pct in London trade while Rio Tinto rose by 1.4pct.

US sharemarket indices edged higher with investors reluctant to make large bets going into the earnings season. According to Thompson Reuters, forecasts for March quarter earnings have been scaled back, with profits seen rising just 1.6pct from a year ago, down from 4.3pct in January. Consumer staples were the best performers with the sector up 0.8pct. The Dow Jones index rose by 48pts or 0.3pct. The S&P 500 rose 0.6pct and the Nasdaq gained 18pts or 0.6pct.

US long-term treasuries fell on Monday (yields higher) as dealers prepared for this week´s auction of $66 billion in longer-dated Treasury debt. US 2yr yields were flat at 0.23pct while US 10yr yields rose by 2pts to 1.74pct.

The Euro and commodity currencies rose against the US dollar on Monday but the Japanese yen weakened. The Euro rose from lows near US$1.2970 to US$1.3035 before settling near US$1.3005 at the close of US trade. The Aussie dollar rose from lows near US103.70c to highs near US104.20c and closed the US session near US104.10c. And the Japanese yen eased from 98.50 yen per US dollar to JPY99.45, and ended US trade at JPY99.30.

World crude oil prices rose on Monday lifted by gains in gasoline futures and strong selling of the spread between Brent and US crude futures. Brent rose by US54c or 0.5pct to US$104.66 and the US Nymex crude price rose by US66c or 0.7pct to US$93.36 a barrel.

Base metal prices were higher on the London Metals Exchange on Monday. The weaker US dollar supported the demand for commodities, while copper also benefited from news of a potential nationwide strike by Chilean miners. Lead (up 0.7pct), Copper and Nickel (both up 0.6pct) recorded the strongest gains. But the gold price fell, with the most active Comex June futures price down by US$3.40 an ounce or 0.2pct to US$1,572.50 per ounce. The iron ore price rose by US$1.70 or 1.2pct to US$137.60 a tonne.

Ahead: In Australia, the NAB business survey and overseas arrivals & departures figures are released. In the US, wholesale inventories are released.

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