In US economic data, the economy grew at 4.2 per cent annual pace in the June quarter, up from the ‘flash’ estimate of 4 per cent and above forecasts of 3.9 per cent. New claims for unemployment insurance fell by 1000 to 298,000 in the latest week and below forecasts of a result near 300,000. And pending home sales rose by 3.3 per cent in July, above forecasts for a 0.5 per cent gain.
European shares fell on Thursday on fears of an escalation in the Russia-Ukraine crisis. NATO said well over 1000 Russian troops were operating inside Ukraine. The FTSEurofirst 300 index fell by 0.6 per cent with the German Dax down by 1.1 per cent while the UK FTSE lost 0.4 per cent. Australia's major miners were also lower in London trade with shares in BHP Billiton down by 2.8 per cent while Rio Tinto lost 3.8 per cent.
US sharemarkets recovered from lows over Thursday's session. Tensions between Russia and Ukraine rattled investors early in the session but then investors chose to focus on positive economic data. The Dow Jones index fell by 42 points or 0.3 per cent after being down 96 points in early trade. The broader S&P 500 index fell by 0.2 per cent while the Nasdaq fell by 12 points or 0.3 per cent.
US treasury prices were firmer (yields lower) in thin trade on Thursday. The tensions between Russia and Ukraine kept investors close to safe-haven assets like government bonds and gold. But balanced against this was stronger-than-expected US economic data. US Treasury sold $29 billion in seven-year notes on Thursday. US 2-year yields fell by 1 point to 0.504 per cent while US 10-year yields were down by 2 points at 2.336 per cent.
Major currencies generally range-traded against the US dollar over the European and US sessions on Thursday. The euro fell from highs near $US1.3220 to around $US1.3160, before ending US trade near $US1.3180. The Australian dollar eased from highs near US93.70c to lows near US93.40c before ending the US session close to US93.50c. And the Japanese yen held between 103.55 yen per US dollar and JPY103.82, ending US trade near JPY103.69.
World oil prices were mixed on Thursday. While there are ample global supplies of crude, traders are closely watching the tensions between Russia and Ukraine. Brent crude fell by US26c or 0.3 per cent to $US102.46 a barrel with the US Nymex price up by US67c a barrel to $US94.55 a barrel.
Base metal prices fell on Thursday up to 1.1 per cent with nickel leading the declines. But tin edged 0.1 per cent higher. Gold prices rose on Thursday in response to geopolitical tensions with the Comex gold futures quote up by $US7.00 or 0.5 per cent to $US1,290.40 per ounce. Iron ore fell by US90c or 1.0 per cent on Thursday to $US87.30 a tonne.
Ahead: In Australia, private sector credit data is due. In the US, personal income and spending are released with consumer sentiment.
Craig James is chief economist at Commsec.