In US economic data, existing home sales fell by 5.4% in June to an annualised two-year low of 5.12 million (survey: 5.35m). MBA mortgage applications fell by 6.3% last week (prior week: -1.7%).

European sharemarkets fell on Wednesday. The pan-European STOXX 600 index dipped by 0.2% on jitters around Russian gas supplies to the continent. Italy’s FTSE MIB index closed 1.6% lower as Prime Minister Mario Draghi faced a confidence vote. The German Dax index lost 0.2% and the UK FTSE index slid 0.4%. Annual UK consumer price inflation rose by 9.4% in June, the strongest pace since February 1982 (survey: +9.3%). In London trade, shares of Rio Tinto fell by 0.4% with BHP shares down by 0.5%.

US sharemarkets advanced on Wednesday after the release of positive corporate earnings results. Netflix shares jumped 7.4% after the company predicted it would return to customer growth during the September quarter. Shares of streaming peers Walt Disney (+3.8%) and Paramount Global (+3.8%) both lifted. Shares of Nvidia rose 4.8% after the US Senate pushed forward a US$50 billion bill to bolster US chip manufacturing. And shares of Tesla added 0.8% ahead of its earnings result. The Dow Jones index rose by 48 points or 0.2% and the S&P 500 index rose 0.6%. The Nasdaq index added 184.5 points or 1.6%.

US treasuries were weaker on Wednesday (yields higher) as traders navigated whether gas disruptions to Europe could push the eurozone into a deep recession. The US Treasury sold US$14 billion of 20-year notes at a yield of 3.42% into strong demand. US 10-year yields rose by around 1 point to near 3.03%. And US 2-year yields lifted by around 1 point to near 3.25%.

Major currencies were mostly weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.0269 to lows near US$1.0154 and was near US$1.0175 at the US close. The Aussie dollar eased from highs near US69.28 cents to lows near US68.72 cents and was near US68.85 cents at the US close. But the Japanese yen rose from near 138.31 yen per US dollar to JPY137.95 and was near JPY138.25 at the US close.

Global oil prices fell on Wednesday after US government data showed lower gasoline demand during the peak summer driving season. Gasoline inventories rose by 3.5 million barrels last week, above analysts’ expectations for a 71,000-barrel rise. The Brent crude price fell by US43 cents or 0.4% to US$106.92 a barrel. And the US Nymex crude price shed US$1.96 or 1.9% to US$102.26 a barrel.

Base metal prices were mostly higher on Wednesday, with the US dollar weakening and an easing of gas supply fears in Europe boosting risk appetite. Nickel rose by 2.9%, but tin eased 0.2%.

The gold futures fell by US$10.50 an ounce or 0.6% to US$1,700.20 an ounce. Spot gold was trading near US$1,695 an ounce at the US close. The iron ore futures price rose by US96 cents or 0.9% to US$104.10 a tonne. Brazilian mining giant Vale lowered its top end annual production guidance by 15 million tonnes to 320 million tonnes in 2022. Ahead: The European Central Bank (ECB) and Bank of Japan hand down policy decisions. In the US, the leading index is released with initial jobless claims and the Philadelphia Fed manufacturing index.tonight.

Originally published by CommSec