Local Markets Commentary

The Australian market commences today’s trade ahead of influential data out of China and following positive overnight international equities sentiment.

In overnight commodities trade, oil continued higher. US gold futures achieved additional moderate gains. LME copper also topped Tuesday’s settlement. Iron ore swung lower.

The $A continued to appreciate, after being pushed beyond US76.50c yesterday evening.

China is expected to report June trade figures midday AEST.

Locally today, the Melbourne Institute publishes its monthly inflation expectations report and the ABS May lending figures.

Overseas Market Commentary

Major European and US equities markets rallied from open overnight, European indices increasing their gains in second-half trade amid several central bank pronouncements and subsequent currency and bond yield swings.

In the US, Federal Reserve chair Janet Yellen commenced two days of parliamentary committee testimony, indicating a reluctance to forge ahead with any series of rate rises to historical heights.

Further policy intentions remained flexible and all change would be considered and well-moderated, Ms Yellen assured.

The Bank of Canada raised its overnight lending rate for the first time since 2010. The rate was increased by 0.25% to 0.75%.

Meanwhile, Bank of England deputy governor Ben Broadbent confirmed no UK rate rise was on the near-term horizon.

In new data releases, the (US) Federal Reserve’s six-weekly 12-region-by-region economic summary ‘beige book’ indicated modest wages and inflation growth across each district.

Weekly (new) mortgage applications fell 2.5%.

In the euro zone, May industrial production improved 4% year-on-year, exceeding forecasts by 0.4% and following a 1.2% rise in April.

UK weekly earnings growth slowed to 1.8% year-on-year from 2.1%. Unemployment was estimated at 4.5%, a 42-year low.

Tonight in the US, Federal Reserve chair Janet Yellen meets with a Senate banking panel.

Among US data releases, weekly new unemployment claims and June producer prices are due.

In overnight corporate news, the Royal Bank of Scotland settled with the (US) Federal Housing Finance Agency, paying $US5.5B in relation to mortgage-backed securities (RBS) business pre-2008.

Google (owned by Alphabet) secured a French court win, reversing a demand for €1.1B worth of back-tax.