• In US economic data, durable goods orders rose by 0.4% in April (survey: +0.6%). Mortgage applications fell 1.2% in the past week after falling 11% in the prior week.
• Minutes of the US Federal Open Market Committee meeting on May 3&4 show that all participants agreed that a half-percentage point rate hike was appropriate and most judged that such hikes will be appropriate at the next couple of meetings. Participants agreed that the Fed should ‘expeditiously’ move monetary policy toward a more neutral stance.
• European sharemarkets were firmer on Wednesday. Banks rose 1.1%, materials rose 1.5%, utilities rose 2% and energy rose 1.9%. The German economy rose 0.2% in the March quarter, easing recession fears. The pan-European STOXX 600 index rose by 0.6%. The German Dax index rose by 0.6% and the UK FTSE index lifted 0.5%. In London trade, shares in Rio Tinto rose by 1.9% while BHP shares rose 0.5%.
• US sharemarkets were higher on Wednesday. Investors absorbed the minutes from the last Federal Reserve meeting. Shares in Tesla rose 4.9% with Amazon up 2.6% and both stocks were key drivers of the S&P 500 index. Department store operator Nordstrom Inc. rose 14.0% on the back of upbeat annual profit and revenue forecasts. The Dow Jones index closed higher by 192 points or 0.6%. The S&P 500 index rose by 1.0%. And the Nasdaq index gained 170 points or 1.5%.
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• US treasuries rose on Wednesday (yields lower). US 10-year yields were flat near 2.76%. And US 2-year yields fell by around 2 points to near 2.50%.
• Major currencies ended weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.0705 to lows near US$1.0640 but was back near US$1.0675 at the US close. The Aussie dollar fell from near US71.15 cents to US70.35 cents and was near US70.85 cents at the US close. And the Japanese yen eased from 126.80 yen per US dollar to JPY127.48 and was near JPY127.30 at the US close.
• Global oil prices rose around 0.5% on Wednesday. US crude stockpiles fell 1 million barrels last week with gasoline inventories also falling modestly. Capacity use at refiners rose to 93.2%, its highest since December 2019. The Brent crude price rose by US47 cents or 0.4% to US$114.03 a barrel. And the US Nymex crude price rose by 56 cents or 0.5% to US$110.33 a barrel.
• Base metal prices were weaker on Wednesday, falling by between 0.4-3.3% with tin down the least and lead down the most. But nickel bucked the trend, up 0.9%.
• The gold futures price fell by US$19.10 or 1.0% to US$1,846.30 an ounce. Spot gold was trading near US$1,854 an ounce at the US close. The iron ore futures price rose by 24 cents or 0.2% to US$133.34 a tonne. Ahead: In Australia, the Australian Bureau of Statistics issues business investment data, detailed jobs data and a business survey. In the US, economic growth, pending home sales and weekly jobless claims data are issued.
Originally Published by CommSec