In US economic data, consumer inflation expectations fell from 5.2% to 5.0% in December (survey: 5.2%). Consumer credit rose by US$27.96 billion in November (survey: US$25bn).
European sharemarkets were firmer on Monday, hitting sevenmonth highs. Investors were encouraged by the fact that China was re-opening its borders. And German industrial production rose 0.2% in November (survey: +0.1%). Rate-sensitive technology stocks rose by 3.4% while construction & materials rose by 2.4% and mining rose by 2.2%. The continent-wide FTSEurofirst 300 index rose by 0.8% and the UK FTSE gained 0.3%.
US sharemarkets were mixed on Monday but technology led the gains. Shares in Tesla rose 5.9% with Reuters noting that “the electric-vehicle maker indicated longer waiting times for some versions of the Model Y in China, signalling the recent price cuts could be stoking demand.” Shares in Apple rose by 0.4% and Microsoft lifted 1.0%. But shares in Macy’s fell 7.3% after disappointing with holiday-quarter forecasts. At the close of trade the Dow Jones index was down by 113 points or 0.3% after earlier being up 304 points. The S&P 500 index was down 0.1%. But the Nasdaq index lifted by 66 points or 0.6%.
US government bonds rose again on Monday (yields lower). US Treasury will sell US$90 billion of debt this week, starting with US$40 billion of three-year notes on Tuesday. On Wednesday US$32 billion of 10-year notes will be sold, and on Thursday US$18 billion of 30-year bonds. US 10-year Treasury yields fell 4 points to 3.53%. And US 2-year Treasury yields fell by 6 points to 4.20%.
Major currencies were firmer against the US dollar in European and US trade. The Euro rose from lows near US$1.0660 to highs near US$1.0760 and was near US$1.0730 at the US close. The Aussie dollar held between US69.05 cents and US69.50 cents and was near US69.10 cents in late US trade. And the Japanese yen rose from 132.63 yen per US dollar to JPY131.56 and was near JPY131.80 in late US trade.
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Global oil prices rose around 1.3% on Monday on expectations that the re-opening of Chinese borders will raise global fuel demand. According to Reuters, China raised a second batch of 2023 crude oil quotas with the total up 20% on a year ago. The Brent crude oil price rose by US$1.08 or 1.4% to US$79.65 a barrel. And the US Nymex crude oil price rose by US86 cents or 1.2% to US$74.63 a barrel.
Base metal prices were firmer on Monday. Copper rose by 2.8% to six-month highs. And aluminium futures rose by 6.5% on reports that stockpiles on the London Metal Exchange are heading towards 22-year lows.
The gold futures price rose by US$8.10 or 0.4% to US$1,877.80 an ounce. Spot gold was trading near US$1,872
an ounce at the US close. Iron ore futures rose by US84 cents a tonne or 0.7% to US$117.41 a tonne.
Ahead: In Australia, the monthly household spending indicator is released on Tuesday. On Wednesday the monthly consumer price index will be released with retail trade and job vacancies.
In the US, Federal Reserve chair, Jerome Powell, participates in a panel discussion in Sweden. Weekly chain store sales data is released alongside the economic optimism and business optimism indexes and wholesale inventories.
Originally published by CommSec
