Tuesday outlook: Higher oil prices to boost Aus shares

Market Reports

by David Chau

The Australian share market will open stronger this morning, thanks to positive leads from overseas.

US equities finished higher – with the Dow Jones and NASDAQ posting new record highs. Energy shares led the way due to an overnight surge in oil prices. There’s also renewed optimism that a deal to cut global oil production may be reached at the next OPEC meeting – at the end of this month.

Since Donald Trump’s election as the next US President, there’s been increasing expectations of fiscal stimulus, financial deregulation, and higher inflation for the US economy. The probability of the Federal Reserve raising interest rates in December is currently priced in at more than 95%.

Markets

Wall Street finished higher overnight: The Dow Jones added 0.5 per cent to close at 18,957, the S&P 500 is up 0.8 per cent at 2,198 and the NASDAQ gained 0.9 per cent at 5,369.

European markets finished higher: London’s FTSE was flat, Paris was up 0.6%, and Frankfurt added 0.2%.

Asian markets finsihed higher as well: the Nikkei has risen 0.8%, the Hang Seng is up 0.1%, and the Shanghai Composite added 0.8%.

The Australian share market closed flat yesterday: The ASX 200 closed 8 points lower to finish at 5,351. This morning, on the futures market the SPI has risen 40 points.

Currencies

The Australian Dollar after 8.00am was buying $US73.69, 58.99 Pence, 81.58 Yen and 69.33 Euro cents.

Company news

German competition regulators have given approval for the proposed takeover of mineral sands company, Sierra Rutile Ltd by Iluka Resources Ltd (ASX:ILU). Iluka is expecting the takeover to be complete by the end of this month. Shares in Iluka closed 0.33% higher at $6.06.

Central Petroleum Ltd (ASX:CTP) has commenced litigation in the Supreme Court of Queensland against Geoscience Resource Recovery Llc (GRR). Central Petroleum is seeking a declaration from the Court that it did not sign an agreement with GRR in regards to certain fees that GRR is claiming. Central’s alternative argument is that even if any agreement was signed, Central’s exploration manager didn’t have authority to sign it. Shares in Central Petroleum last traded at 18 cents.

Commodities

Gold is up $3.80 to $US1,213 an ounce.
Silver is down $0.04 to $16.68.
Copper has gained $0.05 at $2.53 a pound.
Oil has gained $1.92 to $48.28 per barrel.

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