* US stock markets rose again overnight, as traders sent the S&P 500 to 2-month high.
* European stock markets surged in “Risk-On” on Thursday in reaction to the confirmation the bailout of the Spanish banks.
* Asian stock markets rose for a fourth session yesterday, as investors preempted further easing from China and the US.
* Commodities prices generally higher, Gold prices are trading around $US1,580 while crude-oil closed up around $US92.
The Australian market is expected to hold on to gains today, as again traders have a positive lead from the US investors. Markets rose in Europe and in the US as the strong earning season progressed and the fed Chairman hinted at QE3, if it employment remains an issue for the US. Also Germany gave final approval for the EUR100 billion bailout for the Spanish banks.
The SPI Futures is trading above the key support level of 4000, ended up 0.1% (or 2 points) at 4,158. The key levels for our index today are 4120 to 4180.
US stock markets rose again overnight, as traders sent the S&P 500 to 2-month high after another round of strong corporate earnings.
All three benchmark indexes rose over 0.3% for the session, and the trading volumes picked up 5% above the 3-month average. The S&P 500 has advanced extended to 1.7%, in its 3-day rally. The gains were led by the Materials and Technology sectors up over 0.9%, while the Financials and the Consumer sectors ended in the red.
Positive investor sentiment was boosted by better-than-estimated earnings, and traders were buying in anticipation that the Federal Reserve will to add its monetary stimulus because of the recent disappointing domestic economic data. In corporate news IBM, the biggest computer-services provider and EBay, the largest Internet marketplace, gained over 3.5% as profits beat forecasts, while Google the world’s most popular search engine, rose 3% after market as they reported revenue surged 35%.
In economic news sales of existing US homes unexpectedly dropped, while manufacturing in the Philadelphia region contracted for a third month. Consumer confidence weakened, as claims for unemployment benefits rose and an index of leading economic indicators declined more than forecast.
Traders are betting on more stimulus as Federal Reserve Chairman Ben Bernanke said said this week that policy makers are “studying options” for further easing that could be implemented in case economic growth remains too sudued to produce a lasting decline in unemployment.
The Dow Jones closed up 0.3% (or 34 points) at 12,943, the S&P 500 index up 0.3% (or 4 points) at 1,376, the Nasdaq ended up 0.8% (or 23 points) at 2,966 and the smaller cap Russell 2000 was down -0.4%.
European stock markets climbed overnight, and are on track for a seventh striaght week of gains.
In London the FTSE 100 index last closed up 0.5% (or 28 points) at 5,714, the German DAX was closed up 1.1% (or 74 points) at 6,758, while in France the CAC was closed up 0.9% (or 28 points) at 3,263.
Asian stock markets rose yesterday, led by gains in China as traders bought in anticipation of further Chinese stimulus, and bank lending jumped almost double from the previous month.
In China the SSE Composite closed up 0.7% (or 16 points) at 2,184, while in Hong Kong the Hang Seng Index closed doup 1.7% (or 319 points) at 19,559 and in Japan the Nikkei 225 Index was up 0.8% (or 69 points) at 8,795.
The Dollar Index was lower at 82.89 on a higher Euro, while the Australian Dollar last traded lower at 104.23 Commodities prices traded higher again.
For the session the Benchmark crude NYMEX for August delivery was up 1.1% settled at $US92.29. Copper prices are below key support level as Copper for June delivery was up 1.6% (or 6 cents) at $US3.530, while August Gold was up 0.6% (or $US9.80) at $US1,580.
ASX News Today
AGK – AGl says that NSW’s growing demand for gas will be eased after the federal government approved construction of AGL Energy Ltd’s Newcastle gas processing and storage project.
FXJ – Mining billionaire Gina Rinehart’s battle over board seats at Fairfax Media is expected to continue despite the appointment of her close ally Jack Cowin as an independent director.
SGT – Singtel says the ACCC has approved a deal between NBN Co and SingTel Optus to migrate customers from the telco’s cable network to the high-speed national broadband network.
STO – Santos has posted an 18 percent jump in quarterly sales revenue, giving it a financial boost as it develops its costly giant LNG projects.
SWM – Seven West Media have fallen nearly five percent after coming out of a trading halt.
TOE – Toro Energy says the timeline for Western Australia’s planned first uranium mine has slipped following a rigorous environmental assessment phase.
VAH – Etihad Airways is free to double its stake in Virgin Australia to 10 percent after receiving the all clear from the federal regulator.
WES _ Wesfarmers says the head of Coles is worried about a picket line blocking access to a Melbourne warehouse, but the company will not join talks between striking workers and their employer.
WPL – Woodside Petroleum has upgraded its full year production target, thanks to its giant Pluto liquefied natural gas project (LNG) that helped boost second quarter output by 43 percent.
ASX – to open Higher
US & UK/Europe – Higher
Commodities Stock Index up 0.5%
Gold Stocks Index up 1.1%
Oil Stocks Index up 0.3%
US ADRs – Broadly Higher!!…
BHP up 2.7%, RIO down -1.2%; AWC up 5.2%
ANZ up 0.7% & NAB up 1.5%
NEM up 1.1%, JHX up 2.5%, NWS up 0.1%
By Michael Hevern
Head of Research
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