How’dy USA!

In US economic data non-farm payrolls (employment) rose by 304,000 in January (forecast +165,000). Unemployment rose from 3.9% to 4.0%. Average hourly earnings rose 0.1% (forecast +0.3%). Consumer confidence fell from 98.3 to 91.2 in January. The ISM manufacturing index rose from 54.3 to 56.6 in January (forecast 54.2). Construction spending rose by 0.8% in November (forecast +0.2%). 

US share markets were mixed on Friday. The strong economic data generally boosted sentiment together with optimism on the US-China trade talks. The energy sector rose in response to a 3% lift in oil prices. But a weaker-than-expected outlook from Amazon weighed on retailers. Shares in Amazon fell by 5.4%. The Dow Jones index rose by 64 points or 0.3%. The S&P500 index was up by 0.1%. But the Nasdaq index eased by 18 points (or 0.3%). Over the week, the Dow rose 1.3%, the S&P 500 rose 1.6% and the Nasdaq lifted 1.4%.

US treasuries were weaker on Friday (yields higher). US jobs data beat expectations although wage growth was soft. US 2-year yields rose by 4 points to 2.506% and US 10-year yields rose by 5 points to 2.684%. Over the week US 2-year yields fell by 9 points and US 10-year yields fell by 7 points.

Major currencies ended off the highs against the US dollar in US and European trade compared with the Asia close. The Euro rose from near US$1.1430 to US$1.1485 and was near US$1.1455 in late US trade. The Aussie dollar rose from lows near US72.35 cents to US72.85 cents but was back near US72.50 cents in late US trade. And the Japanese yen eased from near JPY108.85 to JPY109.57 and was near JPY109.48 in late US trade. 

Global oil prices rose near 3% on Friday. US jobs data was stronger than expected, boosting prospects for oil demand. In January, Saudi Arabia pumped 350,000 barrels per day less than December. And the number of oil rigs in operation in the US fell by 15 to an 8-month low of 847 in the past week. Brent crude rose by US$1.91 (or 3.1%) to US$62.75 a barrel and the US Nymex price rose by US$1.47 or 2.7% to US$55.26 a barrel. Over the week, Brent rose 1.8% and Nymex rose by 2.9%. 

The gold futures price fell by US$3.10 an ounce or 0.2% to $1,322.10 an ounce. The spot gold price was near US$1,318 an ounce in late US tradeOver the week gold rose by US$24.00 or 1.9%. Iron ore rose by US$1.60 or 1.9% to US$87.00 a tonne. Over the week, iron ore rose by US$12.30 or 16.5%.

Bonjour, Europe!

European share markets were firmer on Friday in response to strong US jobs data and optimism on US-China trade talks. But euro bank stocks were weak. Shares in Deutsche Bank lost 0.6% in response to earnings results. But shares in Electrolux rose 10% in response to its earnings result. The pan-European STOXX600 index rose by 0.3%. The UK FTSE lifted by 0.7% and the German Dax index rose by 0.1%. In London trade, shares of Rio Tinto rose by 1.0% and BHP rose by 1.8%.

Top of the morning, London

Base metal prices rose by up to 2.2% on the London Metal Exchange with zinc doing the best. But aluminium fell 1.7% and copper lost 0.6%. Over the week metals generally rose 3.3-8.4% with nickel up the most. But tin rose by just 0.8%.

G’day, Australia!

The ANZ job ads series is released with building approvals. The Royal Commission report into banking is handed down this afternoon. In the US, factory orders and the ISM New York index is released.

Have a great day, Australia!