Australian Stock Market Report – Morning 2/12/14
By Craig James, CommSec Chief Economist | February 12, 2014 10:07 AM EST
US MORNING REPORT
In testimony to the US House of Representatives, US Federal Reserve chair, Janet Yellen, said that she strongly supports the current policy strategy and expects a ´´great deal of continuity´´. Yellen also noted that recovery in the labour market is far from complete.
President Obama nominates Yellen to head the Fed (Reuters)
Republican leaders in the US House of Representatives agreed on Tuesday to pass legislation raising Washington´s borrowing authority without conditions.
European shares rose on Tuesday with investors encouraged by comments from the new head of the US Federal Reserve, Janet Yellen, who pledged continuity in the central bank strategy. The FTSEurofirst 300 index rose by 1.3% with the UK FTSE up by 1.2% while the German Dax gained 2.0%. Mining shares were also stronger in London trade with BHP Billiton shares up by 1.9% while Rio Tinto gained 2.3%.
US sharemarkets posted solid gains on Tuesday with investors comforted by testimony from the new Federal Reserve chief as well as the agreement to lift the debt ceiling. At the close of trade, the US Dow Jones was up 193 points or 1.2% after being up 225pts at one stage. The S&P 500 was up 1.1% while the Nasdaq gained 43 points or 1.0%.
US long-term treasury prices fell on Tuesday (yields higher) as investors shifted affections from bonds to equities, encouraged by the testimony from the Federal Reserve chief. US 2 year yields rose by 2 points to 0.335% while US 10 year yields rose by 4 points to 2.72%.
Major currencies were mixed against the greenback over the European and US sessions as traders dissected testimony from the new Fed chief. The Euro held between US$1.3630 and US$1.3680, and was near US$1.3640 in afternoon US trade. The Aussie dollar rose from lows near US89.90c to highs near US90.45c, and was near US90.40c in afternoon US trade. And the Japanese yen eased from its strongest levels near 102.15 yen per US dollar to JPY102.69 and was trading near JPY102.60 in afternoon US trade.
World oil prices were mixed on Tuesday. Harsh winter weather was forecast to hit the US east coast, boosting heating oil demand. But gains in oil prices were limited by expectations of further improvement in Libyan oil exports. Brent crude rose by US5c to US$108.68 a barrel while US Nymex crude fell by US12c or 0.1% to US$99.94 a barrel.
Base metal prices were mixed on the London Metal Exchange on Tuesday with gains and declines not exceeding 0.5%. The gold price rose for a fifth straight session on Tuesday with the Comex gold futures up by US$15.10 or 1.2% to US$1,289.80 per ounce. The iron ore price fell by 80c on Tuesday to US$120.00 a tonne.
Ahead: In Australia monthly consumer sentiment data is issued. Commonwealth Bank is amongst those to report half-year earnings. In the US, weekly mortgage data and monthly Federal Budget figures are issued.
[Kick off your trading day with our newsletter]
More from IBT Markets:
Follow us on Facebook
Follow us on Twitter
Subscribe to get this delivered to your inbox daily
Most Popular Slideshows
Join the Conversation
- iOS 8 Jailbreak Release Date Likely this October 2014 with Pangu not Evad3rs Firming Up as Creator
- Chilling: New ISIS Video Addresses Australia; Aussie Teen Delivers Message
- Xiaomi Mi4 And MiPad Prices Likely Slashed, Thanks To Rivals Oppo, OnePlus And Meizu
- The Pirate Bay Blockade: Cost Of Blocking Websites Like TPB Is Ridiculously High
- Top 4 Free-To-Download Apps for Fuller iPhone 6, 6 Plus Experience
- Battery Saving Android 5.0 Lollipop Feature Extends The Battery Life Of Your Android Device By 90 Minutes And Displays Orange Bar While Power Saving Mode Is On
- Apple Inc. (AAPL) Stock Set to Soar Beyond $100 Despite Decline After New iPad Launch