A shock move from the Bank of Japan to adopt a negative interest rate policy sent US stocks well over 2 per cent higher on Friday with upbeat earnings reports and positive economic data adding to the buoyant mood.
That positivity should feed through to the Australian sharemarket today with local stocks also expecting to open higher.
Wall St has still had a shocking month however ending January around 6 per cent lower with the NASDAQ recording even bigger falls.
US economic news
Weak GDP data increased expectations the Fed will go slow on future interest rate hikes. The advance read of fourth quarter GDP came in at 0.7 per cent annual growth, well below the third quarter read of 2 per cent. And the Chicago Performance of Manufacturing Index jumped to 55.6 in January, well above the 42.9 read in December.
Markets
Wall Street closed higher ahead of the weekend: The Dow Jones Industrial Average gained 2.5 per cent to close at 16,466, the S&P 500 added 2.5 per cent to close at 1,940 and the NASDAQ advanced 2.4 per cent to close at 4,614.
European markets also closed higher: London’s FTSE added 2.6 per cent, Paris rose 2.2 per cent and Frankfurt gained 1.6 per cent.
Asian markets closed stronger: Tokyo’s Nikkei added 2.8 per cent, Hong Kong’s Hang Seng rose 2.5 per cent, and China’s Shanghai Composite added 3.1 per cent.
The Australian share market closed higher on Friday: The S&P/ASX 200 Index closed 29 points up to finish at 5,006 to be 90 points higher on the week. On the futures market the SPI is pointing 37 points higher.
Currencies
The Australian Dollar at 7:15AM was buying 70.88 US cents, 49.76 Pence Sterling, 85.98 Yen and 65.43 Euro cents.
Economic news
Due out today from AIG is January PMI. RP Data Core Logic releases their Home Value Index for January and the TD Securities Melbourne Institute inflation gauge for January is also due.
Company news
Farm Pride Foods Limited
(ASX:FRM) says profits are up and it expects EBITDA in the range of $7.5 - $8.5 million. The extra cash will be used for capital expenditure and to pay down debt. Shares in Farm Pride Foods last traded 1.53 per cent higher at $1.33.
QMS Media Limited
(ASX:QMS) says it has acquired 51 per cent of Australian Billboard Company with options to increase to 100 per cent. The deal gives is in line with QMS digital growth strategy with the company also securing the rights to develop three new digital bill boards in Victoria and Queensland. Shares in QMS last traded down 1.2 per cent to $1.24 on Friday.
Ex- dividends Three companies are trading ex-dividend today, Alchemia Limited
(ASX:ACL) will pay 9.3 cents with no franking. Ozgrowth Limited
(ASX:OZG) will pay a quarter of a cent with full franking and WestOz Investment Company Limited
(ASX:WIC) will pay 3 cents fully franked.
Commodities
Gold has added $0.30 to US$1,116 an ounce for the April contract on Comex. Silver is up 1 cent to $14.24 for March. Copper is up 2 cents to $2.07 a pound. Oil has advanced $0.40 to $US33.62 a barrel for March light crude in New York.
