GOOD MORNING PJ, HLL;HERE'S OVERNIGHT MARKET UPDATE:US > bond...

GOOD MORNING PJ, HLL;

HERE'S OVERNIGHT MARKET UPDATE:
US > bond yields were trading mixed overnight amid speculation that the US Federal Reserve will keep interest rates near record lows at this week’s policy meeting. The 2-year yield increased 6bps to 0.855%, whilst the 10-year yield was virtually unchanged at 3.550%.

Australian bond futures > moved in line with US Treasuries, underperforming at the short end of the curve. The implied yield on 3-year bond futures was up 2bps to 4.910% (price down 2bps to 95.090) and the implied yield on the 10-year bond futures was up 1bps to 5.550% (price down 1bps to 94.450).

US equities > advanced after Abu Dhabi provided $10bn to help Dubai World avoid default and Exxon Mobil agreed to buy XTO Energy in a $31bn merger deal. At the time of writing, the DJIA was up 0.3% to 10498, the S&P 500 rose 0.6% to 1113, and the Nasdaq was 0.9 higher at 2210.

European equities > were higher overnight after Abu Dhabi’s decision to help Dubai World restructure its debt triggered a rally in bank stocks. The DJ Euro Stoxx 50 rose 0.8% to 2885, the German DAX increased 0.8% to 5802, and the FTSE was up 1.0%, at 5315.

The Australian SPI 200 > Dec 09 futures contract was down 9 points or 0.2% to 4665.

The USD > weakened against major crosses overnight after Abu Dhabi pledged to bail out Dubai World. EUR/USD weakened initially but quickly pared losses to open higher at 1.4646. GBP/USD opens around 1.6296 after gaining steadily overnight. USD/JPY opens at 88.67 after a quiet session overnight.

The AUD > gained against the major crosses overnight, after easing concerns on Dubai World’s debt increased the appeal of higher-yielding assets. AUD/USD opens higher at 0.9160 after gaining steadily overnight on increased risk appetite. AUD/EUR opens higher at 0.6254, trading strongly overnight. AUD/JPY opens at 81.22 after a quiet session overnight and the AUD/NZD trades marginally lower at 1.2590 after a choppy session overnight.

Crude oil > declined further and is trading near its two-month low after European industrial output dropped, increasing speculation that the regions economic recovery may be slow. WTI futures contract for January fell 0.4% to US$69.60 a barrel.

Spot gold > increased as the US dollar pared gains on reports that Abu Dhabi pledged to bailout Dubai World, increasing the appeal of the metal as an alternative asset. Spot gold rose 0.2% to US$1,124.30 an ounce.

LME > copper December futures increased 1.1% to US$6,913 a tonne after the US dollar weakened, increasing the appeal of the metal. Other base metal futures traded positive, with zinc, nickel and lead increasing 1.6%, 1.8%, and 1.7%, respectively. Aluminium declined 0.7%.

US > wheat increased 1.1% on speculation that US farmers are withholding sales until spot prices narrow the gap with futures on the Chicago Board of Trade. Soybeans rose 2.0% after an industry report revealed record use of oilseed to make animal feed and vegetable oil. Corn rose 0.7%, while Sugar gained 5.3%. Palm oil futures declined 0.6%.

GOOD LUCK TO ALL TRADERS!