Australian Stock Market Report – Morning November 13, 2014

A worker makes an inventory of crates containing Playmobil figures at the Playmobil Malta factory in the Hal Far Industrial Estate outside Valletta April 11, 2014. REUTERS/Darrin Zammit Lupi (MALTA - Tags: BUSINESS ANNIVERSARY EMPLOYMENT SOCIETY)

* In the US, whole sale inventories rose by 0.3% in September after a 0.6% gain in August - a result that should support the September quarter GDP result.

* European shares fell on Wednesday giving back part of the prior two sessions of gains. Disappointing earnings results from the utility stocks weighed on the sector. Germany's top utility E.ON fell 3.4% after posting a steep drop in profits in its key market Russia. The STOXX Europe utility index fell 2.4%. The STOXX European Banking Index fell by 2.1% after regulators imposed penalties in relation to manipulating the foreign exchange market. UBS, Citigroup, HSBC, RBS and JP Morgan were fined a total of US$4.3 billion while investigations into Barclays were still ongoing. The FTSEurofirst 300 index fell by 1.1% with the UK FTSE down 0.3% and the German Dax down 1.7%. In London trade shares in BHP Billiton rose by 0.5% with Rio Tinto gained 1.2%.

* US sharemarkets were mixed on Wednesday. Financial stocks lost ground after the 13-month FOREX probe saw six banks fined a total of US$4.3 billion. Macy's rose 4.6% after it posted strong third quarter earnings. At the close of trade the Dow Jones was down by almost 3 points; the S&P 500 index was down 0.1% and the Nasdaq was up by 15 points or 0.3%.

* US treasuries rose on Wednesday (yields lower). Concerns about economic weakness in Europe and news that Russian military had escalated troop numbers along the Ukrainian border drove demand for safe-haven assets. US 2 year yields fell 1 point to 0.535% while US 10 year yields fell 1 point to 2.361%.

* Major currencies were mixed against the US dollar in European and US trade on Wednesday. The Euro fell from highs near US$1.2495 to lows near US$1.2420, and was around US$1.2435 in late US trade. The Aussie dollar rose from lows near US86.70c to near US87.45c, and was around US87.15c in late US trade. The Japanese yen weakened from 115.00 yen per US dollar to JPY115.75 but was near JPY115.60 in late US trade.

* World oil prices fell again on Wednesday as Saudi Arabia's oil minister said the kingdom will not engage in a price war but made no mention about Saudi's position ahead of the OPEC meeting on November 27. Brent crude fell by US$1.29 or 1.6% to US$80.38 a barrel while the US Nymex crude price fell by US76c or 1% to US$77.18 a barrel.

* Base metal prices were mostly higher on the London Metal Exchange on Wednesday with the exception of tin (down 0.3%) and copper (down 0.1%). Nickel led the gains up 1.2%. Gold fell modestly on Wednesday with Comex gold futures down by US$3.90 an ounce or 0.3% to US$1,159.10 per ounce. Iron ore fell by US10c to US$75.40 a tonne on Wednesday.

Ahead: In Australia, RBA Assistant Governor Kent speaks in Sydney. In the US, no economic data is expected. China releases data on retail sales, industrial production and fixed asset investment.

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