MORNING REPORT (6.00am AEST)
In US economic data, the ISM manufacturing index rose from 53.7 to 54.9 in April. The forward-looking new orders index and the employment sub index continued to expand at a healthy pace. US construction spending increased by 0.2% in March. Public construction hits its lowest levels since 2006. However this was offset by private residential construction lifting to the highest levels since May 2008.
European share markets were generally closed due to the May Day holiday with volumes light across the markets that were open. The UK FTSE closed up 0.4% to its highest level since early March. And mining shares eased in London trade with shares in BHP Billiton down by 1.2% while shares in Rio Tinto fell by 0.8%.
US sharemarkets were mixed on Thursday as the market waited on the non-farm payrolls figures due on Friday. Expectations were now centred on 210,000 jobs to be created for the month of April. Exxon reported first quarter earnings that exceeded expectations, but its shares fell 1% dragging the S&P 500 lower. The Dow Jones index fell by 0.1%. The S&P 500 closed largely unchanged and the Nasdaq lifted by almost 13 points or 0.3%.
US long-term treasury prices rallied on Thursday (yields lower) as traders continued to cover short positions ahead of Fridays all important non-farm payrolls data. US 2 year yields fell by 1 point to 0.41% while US 10 year yields fell by 4 points to 2.61% - a two month low.
Major currencies were generally weaker against the US dollar on Thursday. The Euro fell from highs near US$1.3890 to lows near US$1.3860, before ending US trade around US$1.3865. The Aussie dollar fell from highs near US93.10c to lows around US92.55c before finishing US trade around US92.70c. And the Japanese yen weakened from 102.15 yen per US dollar to JPY102.35 before ending US trade near JPY102.30.
World oil prices edged lower on Thursday as traders continued to react to Wednesday´s data that showed that US crude oil inventories hit record highs last week. Brent crude fell by US31c or 0.3% to US$107.76 a barrel while US Nymex fell by US32c or 0.3% to US$99.42 a barrel.
Base metal prices were mostly weaker on the London Metal Exchange on Thursday with the exception of copper which rose 0.2%. The Comex gold futures quote fell by US$11.90 an ounce to US$1,284 per ounce. Iron ore prices were unchanged, with no trade due to the May Day holiday.
Ahead: In Australia March quarter producer price data and the HIA new home sales figures are released. In the US, non-farm payrolls and factory orders are released.
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