The Market is up 1 point. Dow Jones closed up 76 — US stocks closed up on Friday as optimism grew that politicians will reach a deal to end the budget impasse and avoid a default on federal debt.

All 10 sectors in the S&P 500 closed up, making a gain of at least 0.2%.

Walt Disney Co +2%, Boeing Co +1.7%, Facebook Inc +3.8% after saying they will look to sell advertising on their Instagram service. Union Pacific Corp -1% after results came in weaker than expected.

The weekly Economic Cycle Research Institute index fell from 132.9 to 132.1. Annual growth rate fell from 4.9% to 4.8%.

The Non-farm payrolls report was not released due to the shutdown.

Twitter — Investors also closely watching the upcoming IPO of Twitter after they released their public financial figures.

US treasuries fell on Friday (yields higher) — US 10 year yields rose by 3% to 2.64%.

US Government enters its sixth day of partial shutdown. US House Speaker John Boehner said “that he won’t allow the US to default on its debt, even if that requires Democratic votes as House Republicans met in Washington to find a solution to the budget impasse.”  A one week closure will take 0.1% from economic growth according to the average of 40 estimates taken in a Bloomberg survey of economists.

Spanish 10-year bond yields were down four basis points to 4.21%, Portuguese 10-year bond yields were down 21 basis points to 6.40%.

The US dollar regained some of the week’s losses against major currencies.

The Aussie dollar was trading between US94.20c and US94.55c before ending US trade near US94.30c. The dollar is now trading at US94.28c.

European shares were up on Friday.

The Italian political problem is starting to stabilise after a parliamentary committee recommended that Silvio Berlusconi be expelled from the Senate following his conviction for tax fraud.

Mining shares were up on Friday — RIO +0.3% and BHP +0.1%.

European markets were mixed on Thursday. Economic data was positive with EU retail sales up 0.7%.

Base metal prices were mostly up on Friday.

Gold was down $US7.70 to $US1309.90 per ounce.

Oil was up 53c to $US103.84.

The iron ore price was unchanged at US$131.40 a tonne with Chinese markets still on holidays.

STORIES

  • Last Friday’s important US jobs data was not released due to the shutdown.
  • The VIX Volatility Index fell 5.3% to 16.74 over the weekend.
  • Public holiday in NSW today for Labor Day. The ASX will remain open, but it will be a quiet day.
  • China is looking to open its economy to foreign services suppliers to transform global trade discussions. This will help bypass a block over agriculture and manufacturing exports.
  • US Earnings results — This week will see the first of third quarter earnings from top S&P 500 companies including results from JP Morgan and Wells Fargo.
  • The share price of Tweeter, an insolvent home electronics retailer, has sky rocketed up 2200% after US traders mistook it for Twitter.
  • The reporting season in Europe begins the week starting October 21. Analysts are warning that this reporting season could be subdued and threaten the recent European sharemarket rally.
  • US President Barack Obama cancelled plans to visit Asia to attend the two summits due to the US government shutdown.
  • China — Markets remained closed on Friday for public holidays and will reopen on Tuesday.
  • The RBA looks increasingly comfortable with interest rates at 2.5%.
  • Tomorrow and Wednesday — NAB business survey on Tuesday and the Westpac-Melbourne Institute consumer survey on Wednesday. Both these will give clues on the health of the economy.
  • Thursday — All eyes will be on Employment data which is expected to show a 5000 gain after two weaker months. Unemployment to remain at 5.8%.
  • The Australian Federal Government has nabbed more than $400 million in unclaimed money from Australian bank accounts this year. $85 million came from overseas. $48 million from Asia, $19 million from Europe and $8 million from North America.
  • CSL agrees to settle class action.
  • Leighton Holdings’ (LEI) bribery scandal has prompted Melbourne lawyer Mark Elliott to sue the company.

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Peter Fray
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