CMC Markets Weekly Report

Stocks in the U.S finished in positive territory on the first trading day of March. A better-than-expected ISM manufacturing report offset worries over China and Europe, as investors shrugged off the looming government spending cuts.

Stocks in the U.S finished in positive territory on the first trading day of March. A better-than-expected ISM manufacturing report offset worries over China and Europe, as investors shrugged off the looming government spending cuts.

The Dow Jones Industrial Average rose 35.17 points, or 0.25 percent to close at 14089.66, the blue-chip index now is within 100 points of hitting its all-time peak of 14,164.53 hit on October 9, 2007.

The S&P500 climbed 3.53 points, or 0.23 percent, to end at 1,518.21.The Nasdaq advanced 9.55 points, or 0.30 percent, to finish at 3,169.74.

On the economic front, the pace of growth in the U.S. manufacturing sector edged up to 54.2 from 53.1 in January, exceeding forecasts for a pullback to 52.5. A reading above 50 signals expansion in manufacturing.

Consumer sentiment was better-than-expected in February at 77.6, according to a survey from Reuters/University of Michigan. Economists polled by Reuters expected the University of Michigan Consumer Sentiment reading to be 76.3.

Meanwhile, construction spending declined by 2.1 percent in January to a seasonally adjusted annual rate of $883.28 billion, according to the Commerce Department, missing expectations for a gain of 0.4 percent, according to a Reuters poll. It was the first monthly decline since March 2012.

Personal income fell more than expected in January, dropping 3.6 percent, missing expectations for a decline of 2.2 percent, while personal spending edged up 0.2 percent.

European shares ended lower after weak eurozone manufacturing data, which showed activity continued to fall in February. In addition, Italy released data which showed unemployment in the country reached a 21-year high of 11.7 percent in January. Italy is also mired in political uncertainty after last weekend's national elections.

Major currencies eased against the US dollar in European and US trade on Friday. The Euro fell from highs near US$1.3100 to finish near US$1.3020 in late US trade. The Aussie dollar eased from highs near US102.40c to finish around US102.00c at the U.S close.

World crude oil prices fell again on Friday. Brent crude fell by US98c to US$110.40 and the U.S Nymex crude price eased by US$1.37 to US$90.68 a barrel. Over the week Brent fell by US$3.70 or 3.2 percent and Nymex lost $2.45 or 2.6 percent.

Base metal prices fell up to 2.4 percent on the London Metals Exchange on Friday, except nickel, which finished flat. Gold continued to decline, with the Comex April gold futures price down by US$5.80 an ounce or 0.4 percent to US$1,572.30 per ounce. Over the week gold fell by US$8.60 or 0.5 percent.

In economic news today, we can expect TD Securities inflation gauge for February, ABS building approvals for January and ANZ job advertisements for February.

Tuesday, RBA�s rates decision for March. A Bloomberg survey of 25 economists expects the RBA to hold official interest rates steady at 3 percent. Along with the RBA�s rate decision we also have ABS retail sales for January, balance of payments for December and AIG performance of service index for February. In the U.S, the ISM non-manufacturing index is reported.

Wednesday, we have the ABS gross domestic product for December and in the U.S we can expect the ADP employment report, factory orders, oil inventories and the Fed�s Beige Book.

Thursday, the ABS international trade for January, AiG/HIA performance of construction index for February is reported and in the U.S international trade, jobless claims, productivity & costs, quarterly services survey, natural gas inventories, consumer credit and the Fed balance sheet.

While there�s no major economic announcement in Australia on Friday, the U.S can expect the non-farm pay rolls and wholesale trade.

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