In US economic data, the ISM purchasing managers index (PMI) rose from 55.4 to 56.1 in May (survey: 54.5). JOLTS job openings fell from 11.855 million to 11.4m in April (survey: 11.4m). The S&P Global manufacturing PMI fell from 59.2 to 57.0 in May (survey: 57.5). Construction spending rose 0.2% in April (survey: +0.5%).
The US Federal Reserve Beige Book showed the economy grew at a moderate or modest pace from April through to late May but “retail contacts noted some softening as consumers faced higher prices.” A majority of districts reported strong wage growth.
European sharemarkets eased on Wednesday. German retail sales fell by 5.4% in April – worse than expected. And the Eurozone purchasing managers index for manufacturing eased from 55.5 to 54.6 – the lowest since November 2020. The pan-European STOXX 600 index fell by 1.0%. The German Dax index lost 0.3% and the UK FTSE index fell by 1.0%. In London trade, shares in Rio Tinto rose by 0.1% while BHP shares rose by 1.4%.
US sharemarkets eased in a volatile session on Wednesday with the Dow Jones index trading in a 687 point range. Investors weighed latest economic data and company earnings reports. Shares in Victoria’s Secret rose 8.9% after the lingerie brand topped first quarter profit estimates. Shares in Salesforce rose 9.9% after it raised its full-year profit outlook. The Dow Jones index closed lower by 177 points or 0.5%. The S&P 500 index fell by 0.8%. And the Nasdaq index lost 87 points or 0.7%.
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US treasuries fell on Wednesday (yields higher). US 10-year yields rose by around 7 points to near 2.92%. And US 2-year yields rose by 11 points to near 2.65%.
Major currencies fell against the US dollar in European and US trade. The Euro fell from highs near US$1.0735 to lows near US$1.0630 and was around US$1.0645 at the US close. The Aussie dollar eased from US72.27 cents to lows near US71.55 cents and was near US71.75 cents at the US close. And the Japanese yen eased from 129.15 yen per US dollar to JPY130.18 and was near session lows at the US close.
Global oil prices rose near 0.5% on Wednesday. Reuters reported that two OPEC+ sources said on Wednesday that members did not discuss the idea of suspending Russia from the current oil supply deal, contrary to speculation. The Brent crude price rose by US69 cents or 0.6% to US$116.29 a barrel. And the US Nymex crude price rose by US59 cents or 0.5% to US$115.26 a barrel.
Base metal prices were mixed on Wednesday. Copper rose 0.6% and tin rose by 0.8% but other metals fell by as much as 2.2% with aluminium down the most.
The gold futures price rose by US30 cents or less than 0.1% to US$1,848.70 an ounce. Spot gold was trading near US$1,846 an ounce at the US close. The iron ore futures price rose by US32 cents or 0.2% to US$135.34 a tonne.
Published by CommSec