Howd’y USA!

In the US, non-farm payrolls (employment) rose by 250,000 in October (forecast +190,000). The unemployment rate was unchanged at 3.7%. Average hourly earnings rose by 0.2% as expected with the annual rate up from 2.8% to a decade high of 3.1%. The trade deficit rose from US$53.3 billion to US$54bn in September (forecast US$53.6bn). Factory orders rose by 0.7% in September, with the ISM New York index down from 72.5 to 69.8 in October.

US share markets eased on Friday. US officials gave mixed signals on the extent of progress on trade talks with China. And the jobs data pointed to further rate hikes – most likely in December. Shares in Apple fell by 6.6% after warning that holiday sales may miss expectations. The Dow Jones ended lower by 110 points or 0.4% after tracking a 500-point range. The S&P500 index fell by 0.6% and the Nasdaq index lost 77 points or 1.0%. Over the week, the Dow and the S&P 500 both rose by 2.4% and the Nasdaq lifted by 2.7%.

US treasuries fell on Friday (yields higher) in response to strong US jobs data. Investors also favoured bonds over equities on worries about the trade dispute with China. US 2-year yields rose by 6 points to 2.91% and US 10-year yields rose by 9 points to 3.22%. Over the week, US 2-year yields rose by 8.5 points and US 10-year yields rose by 12.5 points.

Major currencies were softer against the US dollar in US and European trade compared with the Asian close. The Euro fell from US$1.1455 to US$1.1370 and was near US$1.1385 in late US trade. The Aussie dollar fell from near US72.60 cents to lows near US71.80 cents and was close to US72.00 cents in late US trade. And the Japanese yen eased from near 112.65 yen per US dollar to JPY113.30 and was near JPY113.20 in late US trade.  

Global oil prices eased on Friday. The US Secretary of State Mike Pompeo said that eight countries would be allowed to temporarily import crude from Iran when sanctions are applied against the country from Monday. Brent crude fell by US6 cents or 0.1% to US$72.83 a barrel, and the US Nymex price fell by US55 cents or 0.9% to US$63.14 a barrel. Over the week, Brent fell by US$4.79 or 6.2% with Nymex down by US$4.45 or 6.6%.

Hola, Europe

European share markets were mixed on Friday. The pan-European STOXX600 index rose by 0.3%. Over the week the STOXX600 index was up by 3.4% – the best weekly gain in almost two years. Hopes of a mending in the trade dispute between the US and China also buoyed investor sentiment. Trade-sensitive luxury stocks rose. The German Dax rose by 0.4% but the UK FTSE index lost 0.3%. 

Top of the morning, London

Base metal prices were higher by up to 3.5% on the London Metals Exchange on Friday with copper doing the best. But tin fell by less than 0.1%. Over the week copper rose by 1.8% with nickel up 0.2% but other metals fell with zinc down by 3.8%. In London trade, shares of Rio Tinto fell by 0.1% while BHP rose by 0.1%.

The gold futures price fell by US$5.30 an ounce or 0.4% to $1,233.30 an ounce. The spot gold price was trading near US$1,232 an ounce in late US trade. Over the week, gold fell by US$2.50 or 0.2%. Iron ore fell by US45 cents or 0.6% to US$74.10 a tonne. Over the week iron ore fell by US$2.90 or 3.8%.

G’day, Austraila

The CBA and AiGroup services gauges are released, with new vehicle sales and ANZ job ads. Have a great day, Australia!