Australian stocks are set for a positive start this morning after Wall Street ended higher on better than expected earnings by Wal-Mart Stores. Resources firms likely to lead gains after increases in oil, base metals and gold prices overnight.
Yesterday, the local share market closed stronger boosted by positive comments from the US central bank and a positive re-rating of Australia's banking sector. The S&P/ASX 200 Index rose 93 points to 4,436 and on the futures market the SPI200’s is up 41 points.
Checking currencies at 8:30AM the Aussie Dollar has gained overnight and is buying 84.19 US cents, 80.24 Yen, 58.96 Euro cents and 50.8 Pence Stirling.
In economic news out today: the Reserve Bank of Australia's governor Glenn Stevens is due to appear before a Federal House of Representatives standing committee on economics today.
And coming up on the business front today: Leighton Holdings and PMP release their annual results today.
In what’s happening company news: Felix Resources (ASX:FLX) shares last traded at $16.90. The founders of Felix Resources have unanimously backed an all-cash takeover offer by China's Yanzhou Coal Mining worth about $3.5 billion. Felix will resume trading on the ASX following an announcement last night that it and Yanzhou had agreed to a deal under which Felix shareholders would receive $16.95 a share in cash. Felix Resources profits have been increasing year on year over the past four years.
Rio Tinto shares (ASX:RIO) closed higher yesterday, adding 1.38% to $58.80. Rio Tinto has put the sale of its North American coal assets on hold instead choosing to focus on plans to float the assets on the New York Stock Exchange. Rio has lodged an application to launch an IPO for its Cloud Peak Energy coal business for up to $604 million. But it plans to retain at least 80% of the company under US listing rules. The float is expected to be completed by Christmas. Rio Tinto’s 2008 net profit was around half of what it was in 2007.
Checking ex-dividends and going today is Cadence Capital with a 2 cent fully franked divided.
To the international scoreboard: US markets finished stronger overnight. The Dow Jones industrial average rose 37 points. The S&P500 Index added 7 and the NASDAQ rose 11 points.
European markets were higher: London’s FTSE rose 39 points, Paris added 17 points and Frankfurt is up 51 points.
Asian markets were also stronger: Hong Kong’s Hang Seng rose 426 points. Tokyo’s Nikkei added 82 points and the Shanghai Composite is up 28 points.
Looking at Metals: Gold added US$4 to US$956.50 an ounce for the December contract on Comex. For the September contract Silver is up 40 cents to US$14.99 and copper rose 9 cents at US$2.91.
And finally, oil is also higher, up 36 cents to US$70.52 a barrel for September light crude in New York.
