Aust Dollar Back Up Above US71c

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The Australian dollar is firmly back above US71c after it got a boost from some stronger US inflation figures.

At 7.00am (AEDT) on Wednesday, the local unit was trading at US71.21c, up from US70.84c on Tuesday.

US consumer prices rose 0.2 per cent in October, bouncing from falls the previous two months.

Westpac Strategist Imre Speizer said that even though inflation bounced back it was still weak.

Of interest to financial markets on Wednesday will be the release of the Westpac-Melbourne Institute Leading Indexes of Economic Activity and a speech by Reserve Bank assistant governor for financial markets Guy Debelle in Sydney.

Source: Business Spectator

Oil Drops to Two-Month Low as U.S. Seen Swelling World Glut

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Oil declined in New York, closing at the lowest level in more than two months, as U.S. crude stockpiles are estimated to have expanded for an eighth week.

West Texas Intermediate fell 2.6 percent as French jets bombed Islamic State targets in Syria for a second day. U.S. crude supplies probably rose by 2 million barrels last week, according to a Bloomberg survey before Energy Information Administration data Wednesday. Oil futures settled at the lowest level since August when prices tumbled to a six-year low. Both gasoline and diesel futures dropped to the lowest since 2009.

Oil has slumped 46 percent the past year amid speculation a global glut will persist as the Organization of Petroleum Exporting Countries continues to pump above its collective quota and Russian production has climbed to a post-Soviet high. French President Francois Hollande called on the U.S. and Russia to forge a new alliance to destroy Islamic State.

WTI for December delivery fell $1.07 to settle at $40.67 a barrel on the New York Mercantile Exchange. It was the lowest close since Aug. 26. The volume of all futures traded was 9.4 percent above the 100-day average at 3:08 p.m.

Brent for January settlement declined 99 cents, or 2.2 percent, to end the session at $43.57 a barrel on the London-based ICE Futures Europe exchange. It was the lowest settle since Aug. 26. The European benchmark crude closed at a $1.86 premium to WTI for January delivery.

Source: Bloomberg

Japan Stocks Rise for Second Day as Weaker Yen Boosts Exporters

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Japanese stocks rose for a second day as a weakening yen boosted the earnings outlook for exporters. Insurers, paper makers and machinery manufacturers led gains.

The Topix index added 1.1 percent to 1,595.10 as of 9:02 a.m. in Tokyo as all but two of its 33 industry groups advanced. The dollar strengthened for a second day against the yen as firming U.S. inflation data bolstered speculation the American economy can withstand higher interest rates. Investors are waiting the results of a Bank of Japan policy review on Thursday, after Wednesday’s release of minutes from the Federal Reserve’s last meeting.

The Nikkei 225 Stock Average gained 0.9 percent to 19,814.43. The yen traded at 123.44 per dollar after weakening 0.2 percent on Tuesday. E-mini futures on the Standard & Poor’s 500 Index lost less than 0.1 percent after the underlying gauge slipped 0.1 percent on Tuesday, erasing an earlier gain of as much as 0.7 percent.

Source: Bloomberg

U.S. Stocks End Little Changed as Energy Slides, Retailers Rise

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U.S. stocks were little changed as a retreat in energy shares offset higher-than-forecast earnings from Home Depot Inc. and Wal-Mart Stores Inc., while firming inflation bolstered speculation the Federal Reserve will raise interest rates next month.

Crude oil renewed a selloff a day after the commodity’s climb ignited the strongest gains among energy companies in six weeks. Today’s reversal overshadowed a rally in retailers led by Home Depot after the group’s worst weekly drop in four years.

The Standard & Poor’s 500 Index slipped 0.1 percent to 2,050.41 at 4 p.m. in New York, after erasing an earlier gain of as much as 0.7 percent. The gauge’s advance stalled at its average price during the past 200 days.

A report today showed the cost of living excluding food and fuel rose again in October after picking up the prior month, showing inflation edging closer toward the Fed’s goal. It was the strongest back-to-back readings since May and April.

Source: Bloomberg

European Stocks Leap Toward Best Session Since Early October

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European stocks finished sharply higher on Tuesday, aided by a climb in energy and defense shares as the region’s benchmark marked its biggest rise in about six weeks.

The Stoxx Europe 600 jumped 2.9% to close at 379.88, with all sectors advancing. The index was led by a 3.4% rise for the oil-and-gas group resulting in the pan-European benchmark’s best daily gain since a 3% jump on Oct. 5, FactSet data showed.

Energy stocks pushed higher following Monday’s 2.5% rally in oil prices in part on news that output from the Organization of the Petroleum Exporting Countries fell for a third consecutive month.

Source: MarketWatch