Shares have mixed leads, with a strong Chinese manufacturing update and rebounds in commodities taking the edge off a negative finish on Wall Street.
The December SPI 200 futures contract eased nine points or 0.2% to 5320 on Saturday morning as US stocks retreated from record levels during Friday's Thanksgiving holiday-shortened session. However, an upbeat Chinese November factory report released yesterday may cushion any decline.
US stocks closed mixed amid institutional profit-taking during the last session of another positive month. The S&P 500 was ahead for much of the morning before dropping to a loss of one point or 0.07%. The benchmark index made 0.1% for the week and 2.8% during a month that included several record closes. The Dow lost 11 points or 0.07% for the day but made 0.1% for the week and 3.5% for the month. It was the eighth straight winning week for both indexes, the best run since 2004. The Nasdaq rallied 0.38% to a new 13-year high.
"The market essentially ended the week higher, but today flat," Quincy Krosby, market strategist at Prudential Financial in the US, told MarketWatch.
Retail stocks came under the spotlight as the US Christmas holiday shopping season got underway with Black Friday sales. The S&P retail index rallied 0.3%, led by gains in Amazon, EBay and Best Buy.
Eight of 10 S&P industry groups retreated, with telecoms the worst of the sectors. Small caps resisted the negative trend, pushing the Russell 2000 index up 0.14%. Trading volumes were lower than normal, with many traders away from their desks for the traditional Thanksgiving long weekend.
Rio Tinto enjoyed a strong rebound as US traders reacted positively to last week's expansion plan announcement. US-listed shares surged 4.14%. BHP put on 0.57%. Spot iron ore for import to China was unchanged on Friday at US$136.40a tonne.
China's factory activity continued to expand last month, defying expectations for slower growth. The manufacturing purchasing managers' index was steady at 51.4, matching October's 18-month high. Read more here.
Gold shares rebounded in the US as the metal wrapped up its worst month since June with a gain on Friday. The Gold Bugs Index rallied 2.24% as gold for February delivery advanced $13.50 or 1.1% to US$1,251.40 an ounce. Gold has lost more than 25% this year following a 6.5% slide last month.
Base metals also pared monthly losses after unemployment in Europe declined for the first time in four years. US copper for March delivery rallied nearly two cents or 0.5% to US$3.21 a pound. In London, copper gained 0.5%, aluminium 0.1%, lead 0.7%, nickel 0.9%, tin 1.2% and zinc 1%.
Oil bounced off a six-month low but struggled to hold its gain. West Texas Intermediate crude for January delivery ended the session at US$92.78 a barrel, a gain of 48 cents or 0.5%, after earlier rising as high as US$93.92.
The major European markets gave up most of their gains as Wall Street turned negative. Germany's DAX rose 0.19%, France's CAC lost 0.17% and Britain's FTSE dropped 0.05%.
TRADING THEMES THIS WEEK
FLOOD OF DATA: The first week of a new month brings a deluge of economic reports, both domestic and international. At home this week brings a rate decision, quarterly GDP figures and trade, retail and building data. US highlights include the November jobs report, holiday shopping updates, GDP and consumer sentiment. More detail below.
CHINA MAINTAINS MOMENTUM: The weekend brought bright manufacturing news from our biggest trading partner. Further updates from the Chinese economy are due today and tomorrow. HSBC's final manufacturing reading for November drops at 12.45pm EST today. The China Federation of Logistics and Purchasing services PMI is due at noon tomorrow.
ECONOMIC NEWS: A heavy week of domestic reports includes: manufacturing index (9.30am EST today), inflation gauge (10.30am), building approvals, company operating profits (11.30am); retail sales, current account, RBA rate decision and statement (tomorrow); services index, quarterly GDP (Wed); trade balance (Thu); and construction index (Fri). US highlights: manufacturing PMI (tonight); ADP private payrolls, trade deficit, services PMI, new home sales, Fed's Beige Book (Wed); weekly jobless claims, revised GDP, factory orders (Thu); and non-farm payrolls, unemployment rate, personal income and consumer spending (Fri).
