Originally published by CMC Markets
Global share markets rose modestly on good breadth overnight. Oil jumped after US data showed a large weekly draw on inventories, and the US dollar strengthened in response to stronger growth in import prices. Futures markets are pointing to a positive start for Asia Pacific bourses.
The Dow Jones Industrial Average finished the session down slightly, but both the S&P 500 and NASDAQ Composite made small gains, reflecting the broadly positive market sentiment. All three indices remain within a whisker of all-time highs. The strength is all the more remarkable in light of what some describe as a Watergate style scandal brewing in Washington.
Higher oil prices should support the S&P/ASX 200 today, although ongoing pressure on industrial metals may contain enthusiasm. Crude oil markets sprung back on news of a 5.2 million barrel draw down on inventories. However the rally may not last long, as US production rose above 9.3 million barrels a day and inventories persist near record levels.
Today’s session is data light, although yesterday’s higher than forecast inflation reads may continue to support shares. A mild risk on mood is evident, but bond market rallies and a steady gold price suggest not all investors are pro-growth.