In the balance

US shares rose as Apple reminded US investors of the importance of technological innovation to profitability and the European Central Bank launched its QE bond buying program. This positive momentum is likely to lift Asia Pacific shares early in the trading session, but mixed messages from commodity markets and weakness in European shares may keep enthusiasm in check.

The easy digestion by US investors of a possible earlier start to rate rises should see some retracement of yesterday’s local falls. Investors appear to have remembered that US rates are rising because the economy continues to improve. However, further weakness in gold and iron ore is likely to drag on resource shares, partially offset by a 2% jump in copper prices driven by surprisingly strong China export data.

Possibly trumping all overnight influences later in the session will be Shanghai trading. The index gyrated through a 3% range yesterday, initially dropping as investors sold major listed brokers on news that banks would be granted securities dealing licenses. As the market sank, enthusiasm from the newly enabled banks saw the market surge to higher ground and within a few percent of post GFC highs.