Daytrading November 18 pre-market

Morning traders. Thanks Trees and after-market regulars.

Market wrap:

Shares are pointing lower after a rally on Wall Street petered out and a rout in commodities resumed.

The December SPI200 futures contract slid 27 points or 0.5% to 5097 as copper and gold nudged multi-year lows and BHP and Rio Tinto sagged as iron ore plumbed its weakest price in four months.

US stocks advanced in early trade before caution set in ahead of the release tonight of the minutes from the latest Federal Reserve policy meeting. The S&P 500 shed three points or 0.13%, the benchmark index's eighth loss in ten sessions. The Dow rallied more than 100 points on the back of strong gains in Europe before fading to a final gain of six points or 0.04%. The Nasdaq kept a gain of 0.03% or a bit more than a point.

"With the Fed minutes [tonight], anything that seems to have short-term risk, people want to stay away if possible," JJ Kinahan, chief strategist at TD Ameritrade in the US, told CNBC.

The session began brightly after European markets staged their strongest rally since early October. The Stoxx Europe 600 surged 2.49%, Germany's DAX 2.41%, France's CAC 2.77% and Britain's FTSE 1.99% with defence-related shares benefitting from French plans to increase military spending.

Upbeat earnings updates from Wal-Mart and Home Depot helped boost the consumer discretionary sector, offsetting mixed economic data. Consumer prices rose in October for the first time in three months, a seasonally-adjusted 0.2%. Industrial production declined by the same percentage, but the manufacturing sector improved 0.4%.

“Today’s figures are very unlikely to derail a hike in December,” Luke Bartholomew, investment manager at Aberdeen Asset Management in the US, told MarketWatch. “It’s a pretty finely balanced judgment though. Hiking with limited evidence of inflation risks slowing the economy down too much. While hiking only when inflation has bounced back risks not being able to contain it."

The major indices accelerated falls as oil declined and news broke that a football match between Germany and the Netherlands had been cancelled amid terrorism threats. West Texas Intermediate crude oil for December delivery settled $1.07 or 2.56% lower at US$40.67 a barrel ahead of a mid-week data update that is expected to show US inventories increased for an eighth straight week last week. The US energy ETF lost 1.1%.

Iron ore tumbled 4.5% yesterday to its lowest point since early July. Ore delivered to Qingdao sagged 4.5% to US$45.58 a dry metric ton. Spot iron ore shed $1.50 to US$45.80 a dry ton. BHP declined 2.16% and Rio Tinto 2.25% in US trade.

"Prices are still under pressure due to oversupply," Michael Zhu, president of Millennia Resources in Hong Kong, told Fairfax. "There is hardly any Chinese steel mill making profit now, so the demand will be weak through year-end."

Gold stocks slumped more than 5% in the US as the 'fear premium' came out of the gold market. The NYSE Arca Gold Bugs index dropped 5.23%. Gold for December delivery settled $15 an ounce lower at US$1,068.60, the lowest settlement since February 2010. Read more here.

London copper recorded its weakest price since May 2009 before paring its loss to 0.1%. Also in London, zinc gave up 2.5% and nickel 2.1%. Tin was unchanged. Lead rose 0.1% and aluminium 0.5%. US copper for December delivery was recently down 0.9% at US$2.10 a pound.

The dollar was this morning buying 71.24 US cents.

TRADING THEMES TODAY

COMMODITY WOBBLES: It's a good thing every other Australian mining company has switched to tech because the bad news from commodity markets kept flowing last night. The rally in oil floundered, gold, copper and aluminium broke to  fresh multi-year lows and iron ore looks intent on testing the July/April support. BHP headed back towards its US low. Those are the key points after a lacklustre session on Wall Street, where the 'Paris rally' ran out of puff as a terrorism scare in Germany offered a reminder that Friday's atrocity won't be the last attack on western soil. Energy stocks led the rally in Europe, then led the retreat in the US - there will be a few nervous 'energy longs' in Europe this morning. The ASX got a bit ahead of itself yesterday and therefore looks likely to give some back today.

ECONOMIC NEWS: Rival leading indexes are due at 10am and 10.30am EST, but today's most significant domestic report is the 11.30am quarterly wage price index. The minutes from last month's Fed meeting are tonight's US highlight. Also due: building permits, housing starts, crude oil inventories and a speech by a Fed official.

Good luck to all.