A man looks the board of the Australian Securities Exchange ASX in central Sydney August 7, 2013.
A man looks the board of the Australian Securities Exchange in central Sydney August 7, 2013. Reuters/Daniel Munoz
  • Atlanta Federal Reserve president Dennis Lockhart said he was "disposed" to begin raising interest rates in September, but expected a gradual process of lifting rates.
  • European shares rose as investors scoured for bargains. Soft economic data in China raised hopes for more stimulus from authorities. And investors were encouraged by indications that a new bailout deal was close in Greece. The FTSEurofirst 300 rose by 0.7% with the German Dax up by 1.0% while the UK FTSE gained 0.3%. In London trade mining shares were firmer with BHP Billiton up by 1.3% and Rio Tinto up by 1.8%.
  • US sharemarkets rose with investors concluding that markets had become over-sold. Investors also perceived that Chinese authorities had scope to further stimulate the economy. Investors were also encouraged by takeover activity with Berkshire Hathaway saying it would buy Precision Castparts for US$32.3 billion. The Dow Jones rose by almost 242 points or 1.4%, while the S&P 500 lifted by 1.3% and the Nasdaq gained 58 points or 1.2%.
  • US long-term treasury prices fell (yields higher) as investors adopted a more positive posture, embracing 'riskier' assets like equities and commodities. Investors prepared for the quarterly refunding by US Treasury. On Monday, Treasury sold at auction $24 billion of 3-month bills and another $24 billion of 6-month bills. An auction of $24 billion of 10-year notes is set for Wednesday, with $16 billion of 30-year bonds due to be sold on Thursday. US 2 year yields were flat near 0.725% while US 10 year yields rose by 6 points to 2.23%.
  • Major currencies eased against the greenback in the European session only to rebound in the US session. The euro eased from US$1.0980 to lows near US$1.0925, rebounding to highs near US$1.1040 and ending US trade at US$1.1015. The Aussie dollar eased from near US74.00c to lows near US73.55c before rebounding to highs around US74.20c and ending US trade near US74.05c. And the Japanese yen eased from 124.35 yen per US dollar to JPY124.77 before lifting to JPY124.44 and ending US trade around JPY124.56.
  • World oil prices rose in part due to a softer US dollar, making oil cheaper for buyers in Europe and Asia. There was also a supply outage with BP Plc's 240,000 barrel per day crude distillation unit at its Whiting, Indiana refinery shut down by a malfunction. Brent crude rose by US$1.80 or 3.7% to US$50.41 a barrel while US Nymex crude lifted by US$1.09 or 2.5% to US$44.96 a barrel.
  • Base metal prices rose by between 1.1-3.3% on the London Metal Exchange in response to a softer greenback with nickel leading the way and zinc lagging. The Comex gold futures price rose by US$10.10 or 0.9% to US$1,104.20 per ounce. Iron ore was steady at US$56.30 a tonne (holiday in Singapore market).

Ahead: In Australia, the NAB business survey is released with weekly consumer confidence. In the US, data on labour costs and productivity are expected with wholesale sales and inventories and weekly chain store sales.

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