Australian Stock Market Report – Morning November 10, 2014

Employees work at a factory run by PIKO, a model railway manufacturer, in the eastern German town of Sonneberg, October 9, 2014. The small town fell into crisis when East and West Germany reunified but an influx of new firms has helped its economy grow more than fourfold since then and it now has the lowest unemployment rate in eastern Germany. Picture taken October 9. To match Insight GERMANY-WALL/ECONOMY REUTERS/Michelle Martin (GERMANY - Tags: BUSINESS TRANSPORT SOCIETY)

* In the US, non-farm payrolls (employment) rose by 214,000 in October, short of forecasts tipping a 231,000 gain. Unemployment fell to a 6-year low of 5.8%. Average earnings rose by 0.1%. The labour force participation rate rose from 62.7% to 62.8%.

* In China the trade surplus rose from US$31 billion to US$45.4bn in October. Exports were up 11.6% over the year with imports up 4.6%.

* European shares were mixed on Friday as traders dissected US economic data, corporate earnings, French lending figures and increased tensions between Ukraine and Russia. Shares in ArcelorMittal, the world's largest steelmaker, gained 2.3% after reporting a higher-than-expected profit in the third quarter. The FTSEurofirst 300 index fell by 0.5%, the UK FTSE gained 0.3% but the German Dax lost 0.9%. In London trade shares in BHP Billiton were up by 2.9% with Rio Tinto up by 2.4%.

* The US Dow Jones index and S&P 500 closed at record highs on Friday. Investors digested the landscape after the mid-term election results. Investors also digested the implications of latest economic data - suggesting no rush for the Federal Reserve in lifting rates. Healthcare stocks fell most while the energy sector lifted on higher oil prices. The Dow Jones ended trade up by 19.5 points or 0.1%. The S&P 500 index was up by less than 0.1%. The Nasdaq fell by 5.9 points or 0.1%. Over the week the Dow Jones index rose by 1.1% while the S&P 500 gained 0.7% while the Nasdaq rose by less than 0.1%.

* US long-term treasury prices rose on Friday (yields lower) after employment figures fell short of expectations with earnings growth also disappointing. US 2 year yields fell by 6 points to 0.50% while US 10 year yields were down 8 points to 2.30%. Over the week US 2 year yields fell by 2 points and US 10 year yields fell by 4.5 points.

* Major currencies were stronger against the US dollar in European and US trade on Friday. The Euro rose from lows near US$1.2360 to highs near US$1.2465, and was near US$1.2450 in late US trade.

The Aussie dollar rose from lows near US85.40c to US86.50c, and was near US86.30c in late US trade. The Japanese yen strengthened from 115.46 yen per US dollar to JPY114.25 and was near JPY114.53 in late US trade.

* World oil prices lifted from multi-year lows on Friday. Brent crude rose by US53c or 0.6% to US$83.39 a barrel. US Nymex crude price rose by US74c or 0.9% to US$78.65 a barrel. Over the week Brent fell by US$2.47 or 2.9%. US Nymex lost US$1.89 or 2.3% - the 6^th straight decline and the longest losing streak in 16 years.

* Base metal prices were mixed on the London Metal Exchange on Friday. Aluminium lost 1.1% and nickel fell 0.5% but other metals rose up to 1.3%. Over the week zinc lost 3.2% and nickel fell 2.2% but other metals rose up to 2.9%. Gold rebounded from 4-year lows on Friday as the US dollar eased. Comex gold futures rose by US$27.20 an ounce or 2.4% to US$1,169.80 per ounce. Over the week gold lost US$1.80. Iron ore fell by US10c on Friday or 0.1% to a 5-year low of US$75.50 a tonne and fell US$3.00 over the week.

Ahead: In Australia, housing finance data is released. In China, data on consumer and producer prices are released.

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