The rally in risk continued overnight as shares and industrial commodities added to recent rises, although a strengthening US dollar took some gloss off the gains. Bond market pressure also continued. With the base for a trade agreement between China and the US in place, investor attention is likely to turn to imminent corporate reporting around the globe.

Futures are pointing to a positive opening for share markets across the Asia Pacific region. Current account and trade data on Japan is a focus given the recent pressure on the Yen as investors move back from extreme defensiveness. Australian retail sales (Nov, f/c 0.3%, prev 0.3%) gain additional significance given the failure of consumer stocks participate in the overnight rally. The consumer discretionary sector fell in Europe and the US.

Treasury Wine Estates (TWE) surprised Australian investors with an unanticipated update this morning. Despite uncertainty in Asia and the US the company lifted first half estimates and re-iterated its guidance for 25% earnings growth this year. The announcement cuts across recent concerns about consumer behaviour and may catalyse a higher share price for TWE and the sector.

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