US MORNING REPORT (7am AEDT)
In US economic data, claims for unemployment insurance fell by 9,000 in the latest week to 315,000. Retail sales rose by 0.3% in February with sales excluding autos up by 0.3%. Both figures were slightly above forecasts. The Federal Budget was in deficit by $193.5 billion in February, smaller than the forecast $212 billion deficit. And import prices rose by 0.9% in February with export prices up 0.6% - both ahead of forecasts.
European shares fell on Thursday in response to weak Chinese economic data. There was also on-going nervousness about the political situation in Ukraine ahead of Sunday´s referendum in Crimea. And investors remain concerned that European equities are expensive compared with current earnings. The FTSEurofirst 300 index fell by 1.1% with the UK FTSE lower by 1.0%, and the German Dax was down by 1.9%. Mining shares were mixed in London trade with shares in BHP Billiton down by 0.2% while Rio Tinto fell by 0.4%.
US sharemarkets fell in line with European equities in response to weak Chinese economic data. Investors also started to adjust positions ahead of the weekend´s referendum on the future of Crimea. The Dow Jones index closed lower by 231 points or 1.4% with the S&P 500 down 1.2% and the Nasdaq lost 63 points or 1.5%.
US longer-term treasury prices rose on Thursday (yields lower) as investors embraced government bonds in response to weak Chinese economic data. Treasury sold $13 billion in 30-year bonds on Thursday. US 2 year yields fell 4 points to 0.338% while US 10 year yields fell by 9 points to 2.647%.
The Euro and commodity currencies fell against the greenback in European and US trade on Thursday but the Japanese yen rose. The Euro fell from highs near US$1.3965 to US$1.3840 and ended US trade around US$1.3860. The Aussie dollar fell from highs near US91.00c to lows near US90.10c and was around US90.25c at the US close. And the Japanese yen lifted from near 102.80 yen per US dollar to JPY101.59 and was near JPY101.64 at the US close.
World oil prices were mixed on Thursday. While some analysts focussed on weak Chinese economic data, others fretted about potential supply disruptions in Europe with the on-going tensions between Ukraine and Russia. OPEC has raised its forecast for world oil demand for a second month. And US retail sales topped forecasts. Brent crude fell by US63c or 0.6% to US$107.39 a barrel while US Nymex crude rose by US21c or 0.2% to US$98.20 a barrel.
Base metal prices fell up to 1.4% on the London Metal Exchange on Thursday with copper and aluminium leading the declines. But nickel bucked the trend, up by 0.8% on concerns about potential sanctions on Russian exports. The Comex gold futures price rose to fresh six-month highs, up by US$1.90 an ounce or 0.1% to US$1,372.40 per ounce. Iron ore rose by US$4.10 or 3.7% to US$111.50 a tonne.
Ahead: In Australia lending finance data is expected. In the US, data on producer prices and consumer sentiment are expected.
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