Australian Stock Market Report – Morning June 10, 2014

Morning Report
(06:05 AEST)

In US economic data, the employment trends index rose from 117.32 to 118.58 in May. On Friday, data showed a 217,000 lift in employment in May with the unemployment rate stable at 6.3%.

In China, trade data was released on Sunday and showed the surplus lifting from US$18.45 billion to US$35.92 billion in May. Exports were up 7% on a year ago but imports were down by 1.6%.

European shares rose on Monday with the smaller markets - Spain, Italy and Portugal - leading the way. The FTSEurofirst 300 index rose by 0.4% with the German Dax and UK FTSE both up 0.2%. The Spanish market rose 0.9% with Italy up 0.8% and Portugal gaining 0.6%. There was also speculation that Deutsche Telecom would make a bid for another telecoms provider, Orange. Australia´s major miners were up in London trade with shares in BHP Billiton higher by 0.6% while Rio Tinto edged up by 0.1%.

US sharemarkets rose again on Monday, buoyed by good US and Chinese economic data and takeover action in pharmaceuticals. Shares in Apple rose by 1.6% after completing a 7 for 1 share split. The Dow Jones index rose by 18.8 points or 0.1% to record highs after rising 88 points on Friday. The S&P 500 rose by 0.1% to record highs after lifting 0.5% on Friday. And the Nasdaq gained 14.8 points or 0.3% after rising by 0.6% on Friday.

US long-term treasury prices eased on Monday (yields higher) as investors switched from bonds to equities in response to positive views on the global economy. US 2 year yields were up by 2 points to 0.427% while US 10 year yields rose by 2 points to 2.611%.

Major currencies were mixed against the US dollar in European and US trade on Monday. The Euro fell from highs near US$1.3665 at the end of Asian trade to US$1.3580, and closed US trade around US$1.3590. The Aussie dollar eased from highs near US93.60c to US93.35c before finishing US trade around US93.55c. And the Japanese yen swung between 102.37 yen per US dollar and JPY102.59, before ending US trade near JPY102.50.

World oil prices were higher on Monday in response to strong US and Chinese economic data. Brent crude rose by US$1.38 or 1.3% to US$109.99 a barrel with US Nymex up by US$1.75 to US$104.41 a barrel. OPEC oil ministers meet this week and are expected to leave production quotas unchanged

Base metal prices were higher by up to 1.6% on the London Metal Exchange on Monday with lead advancing the most. But copper went against the trend, falling by 0.1%. The Comex gold futures quote rose by US$1.40 an ounce or 0.1% to US$1,253.90 per ounce. Iron ore fell by US20c a tonne or 0.2% on Monday to US$94.30 a tonne.

Ahead: In Australia, the NAB business index is released with the ANZ job advertisements series and housing finance data. In the US, wholesale sales and inventories data are issued. In China, inflation data is released.

[Kick off your trading day with our newsletter]