Updated March 22, 2019 09:48:36

Photo: Wall St traders were more focussed on good news from US factories than growth worries from the Fed (Reuters: Brendan McDermid)

US stocks have rallied after good economic data which offset US central bank fears about the slowing North American economy.

Claims for unemployment benefits fell more than expected and factory production rebounded in the mid-Atlantic region.

Yesterday the US Federal Reserve said it would not raise interest rates this year because of the weakening economy.

RBC chief US economist Tom Porcelli said the positive manufacturing data was just the latest in a long string of sentiment indicators that have carved out a decisive bottom and turned notably higher more recently.

"This points to a notable rebound in economic activity after what is likely to be an ugly first quarter GDP outcome of around 1 per cent real growth," Mr Porcelli said.

Technology stocks helped drive the gains.

In late trade, both the Dow Jones index and the S&P 500 are up around 1 per cent.

The Nasdaq has put on 1.4 per cent.

European Union leaders have agreed to give the UK until May 22nd to leave the EU.

But that is only if UK prime minister Theresa May can get parliamentary approval for her Brexit plan.

Otherwise Britain will have to leave the EU without a legal safety net in a week's time.

The FT 100 in London put on point nine of a per cent as worries about a no deal Brexit saw the pound fall.

In futures trade here the ASX SPI 200 index is up half a per cent to 6,190.

$US rise sinks commodities

A stronger US dollar kept the lid on commodity prices, with industrial metals and energy the hardest hit.

Oil prices fell with Brent crude at $US67.86 a barrel.

Precious metals also struggled, with spot gold weaker at $US1,308 an ounce.

ANZ's Cherelle Murphy said falls the base metals sector were driven by not only the stronger dollar, but the realisation the future may not be too bright.

"The fact that the Fed halted its rate hikes due to the downgrading of its economic forecasts, finally dawned on the market," she said.

Iron ore bucked the trend, with a solid rebound after yesterday's price collapse.

Ms Murphy said supply worries re-emerged, despite a court ruling in Brazil allowing the big miner Vale to restart operations at a major mine.

"However, that was forgotten after Vale shuttered another mine in Brazil due to safety issues," she said.

"That was followed by the closure of Port Hedland iron ore port [as] tropical cyclone Veronica developed into a category four system north of the Pilbara coast, and is expected to strengthen today.

"Consequently, miners in the area have evacuated workers and closed operations."

The Australian dollar has slipped to around 71.1 US cents.

Topics: stockmarket, currency, united-states

First posted March 22, 2019 09:19:50