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In US economic data, the producer price index (PPI) fell by 0.5% in July but was up by 9.8% on the year (survey: +10.4%). The core PPI (ex-food and energy) rose by 0.2% in July to be 7.6% higher on a year ago (survey: +7.7%). Initial jobless claims rose by 14,000 to 262,000 last week (survey: 265,000).

European sharemarkets closed mostly lower on Thursday. The pan-European STOXX 600 index rose by 0.1%. Shares of Aegon jumped 8.9% after the Dutch insurer raised its full-year forecast. But the German Dax index fell by 0.1% and the UK FTSE index dipped by 0.6%. In London trade, shares of Rio Tinto traded ex-dividend, falling by 3.7%, while BHP shares lifted by 1.0%.

US sharemarkets were mixed on Thursday. US producer prices unexpectedly fell in July for the first time in more than two years as energy costs declined. But with the US Federal Reserve set to keep its monetary policy tight, shares of big technology names like Tesla (- 2.6%) and Amazon (-1.4%) both fell. Walt Disney shares lifted 4.7% after the media giant posted stronger-than-expected subscriber numbers for the last quarter. The Dow Jones index closed up by 27 points or 0.1%. But the S&P 500 index fell by 0.1% and the Nasdaq index slid 75 points or 0.6%.

US treasuries were weaker on Thursday (yields higher) as investors bet the US Federal Reserve will press on hiking interest rates as US inflation remains high. The US Treasury sold US$21 billion of 30-year notes at a yield of 3.106% into soft demand. US 10- year yields rose by around 11 points to near 2.89%. And US 2-year yields lifted by around 3 points to near 3.24%.


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Major currencies were mostly stronger against the US dollar in European and US trade. The Euro rose from lows near US$1.0277 to highs near US$1.0362 and was near US$1.0325 at the US close. The Aussie dollar lifted from lows near US70.71 cents to highs near US71.36 cents and was near US71.05 cents at the US close. But the Japanese yen eased from near 131.80 yen per US dollar to JPY133.13 and was near JPY133.05 at the US close.

Global oil prices rose on Thursday after the International Energy Agency raised its oil demand growth forecast. World oil consumption is expected to increase by 2.1 million barrels per day (bpd) this year, up by 380,000 bpd, from the previous forecast. OPEC expects oil demand to lift by 3.1 million bpd in 2022, down by 260,000 bpd from its previous forecast. The Brent crude price rose by US$2.20 or 2.3% to US$99.60 a barrel. And the US Nymex crude price added US$2.41 or 2.6% to US$94.34 a barrel.

Base metal prices rose on Thursday as the US dollar weakened. Slower US inflation also boosted risk appetite while concerns mounted over supply disruptions. Copper hovered near 6-week highs, up 1.0%. Nickel jumped by 5.2% with tin up 3.4%.

The gold futures price fell by US$6.50 an ounce or 0.4% to US$1,807.20 an ounce. Spot gold was trading near US$1,787 an ounce at the US close. Iron ore futures rose by US$1.74 or 1.6% to US$111.01 a tonne on reports that Chinese regulators will maintain stable property financing to support housing demand.

Published by CommSec