* US stock markets played catchup overnight as optimism builds that Greece will remain in the eurozone.
* European stock markets rose for a third time in four days.
* Asian stock markets extended their rally yesterday, on hopes of fresh policy stimulus from the Chinese government.
* Commodities prices lower, with Gold prices traded around $US1,549 while crude-oil closed around $US90.
The Australian market is expected to continue higher today, as traders again confidcne that Greece will remain in the eurozone. Markets rose in the European and the US markets, as US buyers played catchup after the the Memorial Day holiday.
The SPI Futures is trading above the key pivot level of 4080, ended up 0.1% (or 4 points) at 4,107. The key levels for our index today are 4080 to 4140.
See below for ASX listed companies in the news today.
Economics News Today
* May Imported Vehicle Sales
* June DEEWR Monthly Leading Indicator of Employment.
Economics News Today
* Q1 Construction Work Done
* Apr Retail Sales.
U.S. Markets
US stock markets played catchup overnight as optimism builds that Greece will remain in the eurozone.
All three major indexes closed up over 1%, as in the broader the growth-sensitive sectors surged led by the materials, technology and energy sectors. Bellwether stocks such as Bank of America, Alcoa and Caterpillar all added over 3%, but Facebook fell another -10% (down -24% since listing), after options began trading on the stock. Also Chesapeake Energy the natural-gas company shares were active, rising 3.4% after activist investor Carl Icahn reported a 7.6% stake.
Trader sentiment was sparked by the polls over the weekend that showed that the pro-bailout party was in the lead in for the 17 June Greek election battle.
In economic news, US consumers were less confident in May than the previous month, as the unexpected drop marked a third straight drop in monthly sentiment. Also according to the S&P/Case-Shiller home-price index, housing prices continued falling in March but the size of the falls are easing.
All ten company groups that make up the S&P index traded higher, with Materials up 1.7%, Energy sector was up 1.7%, Financials sector up 1.4%, Industrials sector was up 1.4%, Technology was up 1.3%, while Consumer Staples were up 1.4%.
The Dow Jones closed up 1.0% (or 126 points) at 12,580, the S&P 500 index up 1.1% (or 14 points) at 1,332, the Nasdaq ended up 1.2% (or 33 points) at 2,871 and the smaller cap Russell 2000 was down -0.1%.
European Markets
European stock markets rose for a third time in four days. The Stoxx Europe 600 Index rose 0.8% for its highest close in a week, but it has still retreated -10% from its March highs. The Stoxx Europe 600 is trading at 10 times estimated earnings, near the cheapest since January, according to Bloomberg.
Eurozone markets rose in all but Spain and Portugal. Spanish stocks plunged due to continuing concerns about the country’s problematic banking sector and a plunge in domestic retail sales (for a 22nd consecutive month).
The Spanish market is down -11% in May, on concerns that the Spanish banking system will need to be recapitalised. After market close the ratings agency Egan-Jones downgraded Spain’s rating for the third time in a month highlighting the country’s deepening recession, fiscal deficit and massive debt crisis.
Overnight the euro dollar fell to its weakest levels against the dollar since July 2010, as the ratings downgrade added to ongoing concerns about the euro-zone debt crisis.
Across the rest of the eurozone region trader sentimetn was buoyed by hopes that the Chinese government will pursue stimulus sooner rather than later.
In London the FTSE 100 index last closed up 0.7% (or 64 points) at 5,391, the German DAX was closed up 1.2% (or 74 points) at 6,397, while in France the CAC was closed up 1.4% (or 42 points) at 3,085, Spain closed down -2.3% and Italy closed up 0.4%. Greece +1.9%.
Asian Markets
Asian stock markets extended their rally yesterday, on hopes of fresh policy stimulus from the Chinese government.
Investor sentiment was boosted by speculation of more stimulus measures to fuel growth in China, as the government has recently announced spending on key infrastructure projects.
Across the region growth-sensitive resource firms recorded sharp gains, due to expectations of improvind demand if China ramps up spending. Financials also copped a bid, as investors looked at the attractive dividend yields.
In China the SSE Composite closed up 1.2% (or 28 points) at 2,389, while in Hong Kong the Hang Seng Index closed up 1.4% (or 254 points) at 18,800 and in Japan the Nikkei 225 Index was up 0.7% (or 64 points) at 8,657, South Korean KOSPI was up 1.4% for the session, while the Indian market closed up 0.1%.
Commodities
The Dollar Index was higher at 82.52 on a lower Euro, while the Australian Dollar last traded lower at 98.34. Commodities prices traded lower.
For the session the Benchmark crude NYMEX for June delivery was down -0.2% settled at $US90.76. Copper prices are looking for key support level as Copper for July delivery was up 0.4% (or 1.4 cents) at $US3.462, while July Gold was down -1.3% (or -$US20.20) at $US1,548.70.
ASX News Today
DTE – Dart Energy has shelved plans to separately float its international business due to poor market conditions and a fall in its own share price.
EHL – Emeco the earthmoving equipment supplier has forecast full year profit growth of up to 41 per cent due to strong demand in Australia, Canada in Indonesia.
NHC – New Hope the thermal coal miner, has lifted production and sales from its low-cost Queensland mines in the third quarter.
OZL – Oz Minerals says copper price to remain up as the head of Australia’s third-largest copper producer, has predicted that prices for the commodity will return to record highs as a lack of new discoveries leads to a supply shortage this year.
QRN – Queensland regulators have approved the planned $330 million Wiggins Island Rail Project which will be used to transport coal.
SEK – Seek the employment website has increased its ownership in Brasil Online and Online Career Center Mexico SA de CV (OCC).
SUN – Suncorp the financial group, says its insurance business is improving from a troubled 2011, but other areas of the business will take longer to meet growth targets due to a volatile market.
TTS – Tatts Group the lotteries and gaming services operator, will raise $200 million by issuing bonds to investors in order to pay off bank debt.
WDC – Westfield the shopping centre giant says it is confident it can attain its EUR1 billion euros in sales target in Milan despite continuing financial crisis in Europe.WPL – Woodside Petroleum recently reported its first quarter revenue was up 20 percent to $US1.2 billion, despite a 10 percent fall in production due to the impact of cyclones.
Corporate News
Reporting today:
APN News & Media (APN) Q1 2012 Trading statement
Wesfarmers Ltd (WES) Investor Briefing Day
Ex-dividend Date
None
Market Summary
ASX – to open higher
US & UK/Europe – higher
Commodities Stock Index up 1.3%
Gold Stocks Index down -1.6%
Oil Stocks Index up 1.6%
US ADRs – Broadly higher!!…
BHP up 3.6%, RIO up 4.4%; AWC up 13.3%
ANZ 3.8% & NAB up 3.7%
NEM down -1.4%, JHX up, NWS up 0.3%
By Michael Hevern
Head of Research
Tags: Asian Markets, ASX, ASX News, Business News, Commodities, Crude Oil, European Markets, Ex Dividend, gold price, Nasdaq, Stock Market Analysis, stockmarket, trading, US Market wrap
