SCOREBOARD: Nonplussed stocks

More good news on the US jobs front last night, with new claims falling to 469k (expected) from 498k and continuing claims dropping to 4.5m from 4.63m – yet it was hard to see the love. It looks like everyone is sitting tight until we see the payroll numbers tonight.

Things could have been a lot better, especially as there seems to be no shortage of demand for Greek debt. They issued €5bn overnight and received strong demand for it, with about €14bn of bids. European stocks weren't fussed however, with the Dax falling 0.4 per cent and the FTSE100 down 0.1 per cent. In the US, the S&P500 is up 0.3 per cent (1121) as I write, easing a little from a high of 1123 ( 0.4 per cent) shortly after the open. Financial and consumer stocks are the key outperformers, the latter getting a boost from data showing a recovery in household spending. Same store sales rose by 3.7 per centy/y in February, according to the ICSC, despite the bad weather. The other indices were similarly bid, the Dow up 26pts to 10422, the Nasdaq was 0.4 per cent higher (2289) while the SPI was also 0.4 per cent higher at 4766.

On the FX and commodity side, we saw the US dollar index up 0.6 per cent from 1630. The euro was down a big figure to 1.3575 with sterling down 40 pips to 1.5036 as the ECB and BoE kept rates steady as expected (at 1 per cent and 0.5 per cent). The ECB did however, (and as flagged) outline additional measures to tighten liquidity. They are phasing out six month tenders with 3m tenders reverting to auctions. Unlimited liquidity will still be provided at the one week and month operations so there isn't a near-term prospect of market rates getting close to the 1 per cent target – thus the fall in euro (well that and comments from Trichet that the recovery would be uneven).

The yen was at 89.15 from 88.48 and there was some news that Japan is set to raise its FX intervention borrowing limit (up $US56bn), which has got everyone excited about the prospect of some serious intervention. The Australian dollar is otherwise little changed at 0.8997. Crude fell 0.6 per cent to $80.37, gold was down $8 ($1132) while base metals were mixed (copper down 2.4 per cent, nickel and zinc up 1.5 per cent/2 per cent).

There was slightly more action on the rates side, especially the 2-years, which travelled within an 8bps range to end 6bps higher (0.86 per cent). Most of this action occurred after the jobless claim numbers as punters started looking at the chance of a stronger payrolls result tonight. The yield on the 5-year was up 3bps to 2.27 per cent, while the 10-year was up 1bp on a 6bps range (3.61 per cent). Aussie futures were a little more subdued with the 3s and the 10s on a 4/5 tick range and ending up only smalls (95.18 on the 3s and 94.56 on the 10s).

Data was otherwise minor – fourth quarter US productivity was revised up to 6.9 per cent from 6.2 per cent. US factory orders rose 107 per cent in January (expected), pining home sales fell 7.6 per cent in January (weather related) and finally Canadian building permits fell 4.9 per cent in January which is the first fall in 7 months (starts and permits remain healthy).

Nothing in Australia today and all the action is tonight with US payrolls. The median forecast is for a fall of 63k in February with the unemployment rate forecast to rise to 9.8 per cent from 9.7 per cent.