Scoreboard: ECB boost

European markets surged on news that the ECB was mulling a plan to buy corporate bonds, while Wall Street also rose following strong corporate earnings.

US economic data, existing home sales rose 2.4 per cent in September to an annual rate of 5.17 million units -- the strongest reading in a year. At the current sales pace, the inventory of homes on the market for sale fell from 5.5 month's supply to 5.3 months.

European shares rallied on Tuesday after speculation mounted that the European Central Bank is considering buying corporate bonds to revive the region's economy. A Reuters report said the ECB bond buying plan could be approved by December and start early next year. The plan could help to free bank balance sheets for lending, particularly for the peripheral economies. The STOXX Euro 600 Banking index rose 3.3 per cent. The FTSEurofirst 300 index rose 2.1 per cent. The UK FTSE rose 1.7 per cent and the German Dax gained 1.9 per cent. And Australia's major miners were stronger in London trade with shares in BHP Billiton up by 1.8 per cent while Rio Tinto rose 2.0 per cent.

US sharemarkets recorded strong gains on Tuesday supported by healthy corporate results. A day after reporting strong earnings, Apple shares lifted by 2.7 per cent. The S&P 500 has now gained more than 6 per cent since its session low last Wednesday and closed above its 14-day moving average for the first time in almost a month. The Dow Jones rose by 215 points or 1.3 per cent with the S&P 500 index up by 2.0 per cent while the Nasdaq rose by 103 points or 2.4 per cent.


US long-dated treasury prices eased on Tuesday (yields higher). Mildly better than expected Chinese data and better US data allayed concerns global growth concerns and demand for safe-haven government bonds. US two-year yields were unchanged at 0.358 per cent while US 10-year yields rose 3 points to 2.223 per cent.

Major currencies fell against the greenback over European and US sessions on Tuesday. The Euro fell from highs near $US1.2835 to lows near $US1.2715, ending US trade near $US1.2720. The Aussie dollar fell from highs near US88.25c to lows near US87.70c ending the US session near US87.75c. And the Japanese yen weakened from ¥106.25 per US dollar to ¥107.00, ending US trade near ¥106.90. 

World oil prices rose mildly, supported by the better economic data and the recent sell-off. Brent crude rose by US87c to $US86.22 a barrel while the US Nymex crude price rose by US10c to $US82.81 a barrel.

Base metal prices were mostly higher on the London Metal Exchange on Tuesday, with the exception of nickel (down 0.4 per cent) and zinc (down 0.2 per cent). Copper (up 1.6 per cent) and aluminium (up 1.2 per cent) led the gains. Gold rose on Tuesday with the Comex gold futures quote up by $US7 an ounce or 0.6 per cent to $US1,251.70 per ounce. Iron ore was up by US30c on Tuesday or 0.4 per cent to $US81.50 a tonne.

Ahead: In Australia, the September quarter Consumer Price Index is released. Similarly in the US, September quarter CPI data is released.