In US economic data, retail sales rose by 1.3% in October (survey: +1.0%). Industrial production fell by 0.1% in October (survey: +0.2%). Export prices fell 0.3% in October (survey: -0.4%) with import prices down 0.2% (survey -0.4%). The NAHB index fell from 38 to 33 in November (survey: 36).
European sharemarkets were weaker on Wednesday, led by losses at the Mercedes Benz Group. Shares in Mercedes Benz slid 6.2% after the premium German carmaker cut prices on some of its models in China due to changing market demand for top-end electric vehicles. Autos fell by 3.7%. News that British inflation hit a 41-year high of 11.1% also weighed on sentiment. The continent-wide FTSEurofirst 300 index fell by 0.8%. And the UK FTSE 100 fell by 0.3%.
US sharemarkets were weaker on Wednesday. Retailer Target disappointed with third quarter earnings and its outlook statement and its share price fell 13.1%. Shares in chipmaker Micron Technology fell 6.7% after is said it would reduce memory chip supply and cut its capital expenditure plans. But shares in home improvement retailer
Lowe’s rose by 3.0% after increasing its annual profit forecast. At the close the Dow Jones index was down by 39 points or 0.1%. The S&P 500 index fell by 0.8%. The Nasdaq index was down by 175 points or 1.5%.
US long-term government bonds rose on Wednesday (yields lower). A US$15 billion auction of US 20-year bonds went at an average yield of 4.072%. Kansas City Federal Reserve President Esther George said that inflation is at risk of becoming entrenched in the economy from an overheated job market. US 10-year yields fell by 11 points to near 3.68%. But US 2-year yields rose less than 1 point to near 4.36%.
Major currencies were mixed against the US dollar in European and US trade. The Euro held between US$1.0305 and US$1.0435 and was near US$1.0395 at the US close. The Aussie dollar held between US67.20 cents and US67.90 cents and was near US67.40 cents at the US close. And the Japanese yen rose from near 140.30 yen per US dollar to JPY139.10 and was near JPY139.45 at the US close of trade.
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Global oil prices fell by around 1.5% on Wednesday. The restarting of Russian oil shipments via the Druzhba pipeline to Hungary and rising COVID-19 cases in China weighed on sentiment. But supporting prices was data showing a larger-than-expected decline in US crude stocks in the past week. The Brent crude oil price fell by US$1.00 or 1.1% to US$92.86 a barrel. And the US Nymex crude oil price fell by US$1.33 or 1.5% to US$85.59 a barrel.
Base metal prices were weaker on Wednesday with nickel recording a 9.1% decline. Copper also fell in response to data showing that Chinese new home prices recorded the biggest decline in more than seven years. But supporting copper is an upcoming strike announced by workers at Chile’s Escondida, the world’s largest copper mine.
The gold futures price fell by US$1.00 an ounce or 0.1% to US$1,775.80 an ounce. Spot gold was trading near US$1,773 an ounce in US trade. Iron ore futures rose by US5 cents or 0.1% to US$92.34 a tonne.
Originally published by CommSec