The iron ore price tanked overnight on rising concerns about China’s property market.

The commodity’s benchmark spot price in China plunged 4 per cent overnight to a five-and-half-year low of $US72.10 a tonne.

The price has now almost halved from the beginning of the year when it was worth more than $US130.

Overnight’s price fall was brought on by news that new house prices in China are dropping as demand slows and stock rises.

The fall is expected to weigh on Australian mining stocks, which has saw earlier gains on the SPI 200 Index ease back to a rise of just 0.1 per cent at 8:30am (AEDT).

Wall Street was not too bothered by the falling ore price overnight, as traders focused on merger and acquisition activity and a pick-up in European investor confidence.

The S&P 500 hit another record high, rising 0.5 per cent to 2,052.

The Dow Jones added 0.25 per cent to 17,687.

The healthcare sector led gains, as investors continue to push stocks higher on yesterday’s announcement that pharmaceutical giant Allergan is paying $US66 billion for Botox-maker Actavis.

Actavis shares gained 8.7 per cent and Allergan added 2 per cent.

Also keeping traders upbeat was data showing US wholesale prices unexpectedly rose from -0.1 to 0.2 in October, indicating a pick-up in demand.

Wall Street has been buoyant over the last month, it is now 10 per cent higher than the six-month low it hit mid-October, and has made gains in nine of the ten last sessions.

In Germany, a leading survey of investor confidence rose for the first time in almost a year, jumping from -3.6 to 11.5 in November.

As a result, markets saw strong gains: London’s FTSE 100 added 0.6 per cent and the Eurostoxx 50 closed up 1.2 per cent.

Asian markets will be keeping an eye on Japan, after Prime Minister Shinzo Abe called an election two years ahead of schedule to get a fresh mandate for his economic reforms.

The Australian dollar is slightly higher than this time yesterday worth 87.2 US cents.

Gold rose to a two-week high on speculation the European Central Bank may purchase assets including bullion to counter low inflation.

It closed the session at $US1,197.25 an ounce.

West Texas crude closed down at $US74.50 a barrel while Tapis was slightly higher at $US79.47.