Australian Stock Market Report – Morning 4/11/14

US MORNING REPORT
(6am AEDT)

In US economic data, new claims for unemployment insurance fell from 332,000 to 300,000 in the latest week, well below forecasts centred on a result near 320,000. Import prices rose by 0.6% in March with export prices up 0.8% - both results above expectations. And the Federal Budget was $36.9 billion in deficit in March, around half economist forecasts.

European shares fell on Thursday as investors cashed in profits on strong performing stocks and markets. The FTSEurofirst 300 index fell by 0.5% and the German Dax similarly lost 0.5% while the UK FTSE rose by 0.1%. Mining shares eased modestly in London trade with shares in BHP Billiton down by 0.6% while shares in Rio Tinto fell by 0.3%.

US sharemarkets slumped on Thursday, reversing Wednesday´s gains, as investors booked profits on high performing technology, biotechnology and pharmaceutical stocks. Shares in Amazon, Facebook and Netflix all lost 4-5%. The Dow Jones index fell by 267 points or 1.6% with the S&P 500 down by 2.1%, while the Nasdaq lost 130 points or 3.1%.

US treasury prices rose on Thursday (yields lower) as investors switched from equities into bonds and gold. US Treasury sold $13 billion of 30-year bonds on Thursday. US 2 year yields fell by 2 points to 0.351% while US 10 year yields fell by 4 points to 2.647%.

Major currencies rose against the greenback in European and US trade on Thursday. The Euro lifted from lows around US$1.3835 to near US$1.3895, before ending US trade around US$1.3885. The Aussie dollar held between US94.00c and US94.60c before finishing US trade around US94.15c. And the Japanese yen strengthened from 101.94 yen per US dollar to JPY101.34 and was near JPY101.45 at the US close.

World oil prices fell on Thursday as investors responded to weaker-than-expected Chinese trade figures. There was also the prospect of more oil supply from Libya with Reuters reporting ´´national oil officials lifted a force majeure on the North African country´s easternmost port of Hariga, a port that had been blockaded for nine-months as part of a dispute between the government and rebel groups.´´ Brent crude fell by US52c or 0.5% to US$107.46 a barrel while US Nymex fell by US20c to US$103.40 a barrel.

Base metal prices were firmer by up to 2.3% on the London Metal Exchange on Thursday with nickel and aluminium leading the gains although copper rose just 0.5%. The gold price rose on Thursday to a near 3-week high in response to the ´´dovish´´ Federal Reserve minutes. The Comex futures quote rose by US$14.60 an ounce to US$1,320.50 per ounce. Iron ore fell by US30c to US$119.10 a tonne on Thursday.

Ahead: In Australia lending finance data is released. In the US, data on producer prices and consumer sentiment are released. In China, inflation data is released.
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