International equity markets finished with solid gains overnight amid optimism that the fiscal cliff may be averted before the year ends.

Obama and Boehner are coming closer to negotiating a compromise; Obama lowered his tax revenue demand by $200 billion and offered to start tax rate increases at $400,000 in income instead of $250,000, moving closer to a budget deal with House Speaker.

The UK's FTSE increased 24 points (+0.4%) to settle at 5936 whilst Germany's DAX climbed 49 points (+0.6%) to settle at 7654. France's CAC added 11 points (+0.3%) to settle at 3649.

Markets in the US rallied yet again with the Dow Jones putting on 116 points (+0.9%) to settle at 13351 whilst the S&P rose 16 points (+1.2%) to settle at 1447. The Nasdaq increased 44 points (+1.5%) to settle at 3055.

In the commodity space, oil traded higher on the back of equity markets gains and after the American Petroleum Institute mentioned that US oil supplies fell by 4.1 million barrels in the previous week.

Crude oil for January delivery added $0.73 to settle at $87.93.

Gold fell to a three-month low as progress in the US budget discussions whet investor appetite for riskier alternatives. Gold futures for February delivery shed 1.6% to settle at $1670.70.

In the currency space, the Japanese yen continued to trade lower ahead of the latest BoJ meeting, whilst the euro traded to a seven-month high against the US dollar due to market optimism. Today will see the release of the MI leading index (10:30am, AEDT).

Morning Market Update: Bulls Run On is a post from: Australian Stock Report Market Pulse Blog