By Greg Peel

The Dow closed up 36 points, or 0.3%, while the S&P gained 0.4% to 1415 and the Nasdaq was up 0.7%.

Here's a thought. What if both sides of the Cliff negotiations agreed not to make any public statements on the progress or lack thereof and simply waited until there was a definitive announcement to make? Thank God it's now the Silly Season in Australia because we'd all go nuts otherwise, suffering through the political ebbs and flows that are being played out on Wall Street down to the last partisan word.

Last night the Dow was up around 75 early, then Boehner (R) said no progress had been made in two weeks (on Wednesday he was all smiles and confidence) and the Dow fell to be down 25, then Reid (D) suggested a solution would be achieved by Christmas and the Dow was up 50, then it drifted to the close.

Give me strength.

In real news last night, the first revision of the US September quarter GDP came in at 2.7%. This slightly missed consensus expectation of 2.8%, but well exceeded last month's first estimate of 2.0%. To recap, the process is one of assessing the first month of the quarter and extrapolating to the whole quarter, then assessing the second month and adjusting that extrapolation, then assessing the third month to provide a "final" number which can again be drastically revised at the release of the next quarter's first estimate.

Pending home sales numbers for October added more fuel to the housing recovery fire by rising 5.2% in the month for a 13.2% year on year gain.

As this week's Fed Beige Book confirmed, the US economic recovery is being led by the housing and consumer sectors. Last night's release of November chain store sales growth was nevertheless a disappointment at 1.7% given last year's equivalent number was 3.5%. November is critical, as it includes Black Friday, but in a quirk of the calendar this year the numbers do not include Cyber Monday. So economists are confident there will be a positive adjustment in the December numbers. And there was also a Sandy effect in the November data.

Speaking of Sandy, new weekly jobless claims are adjusting back now that affected workers are able to return to the job. A fall of 23,000 new claims last week means the running average is back under 400,000, implying the capacity for the unemployment rate to fall.

Jumping back to the home front for a moment, we note that yesterday's release of Australian September quarter capex numbers coincided neatly with AGMs for both BHP Billiton ((BHP)) and Rio Tinto ((RIO)). Both companies announced further cost cutting, but it was Rio in particular that declared a hatchet would be taken to costs, mostly in its coal and aluminium businesses. Meanwhile, while the capex results exceeded consensus, the devil was in the "expectations" numbers, which confirmed the mining sector in general is rapidly reining in its spending plans.

Now let's note that while the US dollar index is only down 0.1% to 80.20 over 24 hours, the Aussie is down 0.5% to US$1.0432 and the aluminium price jumped 3% in London last night. Reined in spending noted in the capex report and cost-cutting confirmation from the two Big Miners is enough to encourage those looking for another RBA rate cut next week and, one presumes, Rio's specific aluminium cutbacks are enough to provide some support to prices. Inventory data and "fiscal cliff hopes" were touted as excuses on the LME last night, which saw not only aluminium up 3%, but copper and zinc up 2% and lead and tin up 1%. Chinese spot iron ore tends to march to its own drum, and it fell US$1.00 to US$116.90/t.

The oils were also up, this time with positive US data being used as the excuse. Brent rose US$1.25 to US$110.76/bbl and West Texas rose US$1.36 to US$87.85/bbl. And after taking a dive on Wednesday night, gold recovered to rise US$7.00 to US$1726.10/oz.

Rio's cost-cutting seemed to go down well in London, where the stock is up 5% overnight. Never mind the drop in the iron ore price. And strength in both Rio and BHP will help explain why the SPI Overnight is up an enthusiastic 23 points, or 0.5%.

The monthly private credit numbers out today will help with Tuesday's RBA decision, as will the PMI, trade balance and retail sales numbers due Monday. And China will release its official PMI tomorrow.

Today will effectively be the last day of the local AGM season, with but a mere handful of stragglers meeting next month.

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