US Strength

Weaker than forecast US manufacturing and home sales checked but did not derail investor enthusiasm in overnight trading. Markets drew little implications from the numbers, and a rampant US dollar kept the pressure on commodities while weighing on European US shares. Local markets are indicating a lower opening, but investors have plenty to watch as consumer confidence data drops and groups such as Qube, Technology One, Harvey Norman and Billabong host AGMs.

A greater than expected fall in US housing sales in October raised little concern, nor did a weaker than expected expansion in manufacturing in November. The rhetoric from the Fed suggests numbers would have to fall off a cliff to stop an interest rate rise in December. The strongest candidate is non-farm payrolls on December 5. However, a pass mark is all that is required, so any read above 175,000 will likely confirm the lift. Equity investors appear relaxed about higher rates, but concerned by a higher US dollar.

Futures are indicating modest falls at the open in Australia, and small rises for Japan and Hong Kong. The difference is commodities. Wild gyrations in oil and another copper tumble could see further pressure on resource stocks in trading today. AGM outlook commentary from Harvey Norman and Adelaide and Bendigo Bank may have broader market implications.