Post-US election still going strong: ASX to open higher

Market Reports

by David Chau

The Australian share market is set to open higher this morning, following positive leads from overseas.

The post-US election rally is still continuing, with Wall Street closing at new record highs again, and most sectors finishing in positive territory.  The Financials sector was the strongest performer, and it’s is still riding the wave of optimism over prospects of financial deregulation under a Donald Trump presidency.

On the other hand, Energy was the weakest link due to an overnight fall in oil prices after it was reported that OPEC produced a record amount of crude oil last month.

US economic news

Productivity in the third-quarter of this year rose at an annualised rate of 3.1%, according to the Labor Department.

America’ trade deficit widened by 17.8% to $42.6 billion in October – which is its largest increase since March 2015.

Also in October, factory orders increased by 2.7%. This is the fourth straight month of increases, and the biggest gain since June 2015.

Markets

Wall Street finished higher overnight: The Dow Jones gained 0.2% to close at 19,252, the S&P 500 was 0.3% higher at 2,212, while the NASDAQ rose 0.5% to close at 5,333.

European markets finished higher as well: London’s FTSE was up 0.5%, Paris gained 1.3%, and Frankfurt added 0.9%.

Asian markets finished mixed: the Nikkei gained 0.5%, the Hang Seng was up 0.8%, while the Shanghai Composite fell 0.2%.

The Australian share market finished stronger yesterday, with the ASX 200 closing 28 points higher at 5,429. This morning, on the futures market the SPI is up 35 points.

Currencies

The Australian Dollar at 8.30am is buying $US0.7461, 58.87 Pence, 85.08 Yen and 69.61 Euro cents.

Local economic news

Yesterday, the Reserve Bank of Australia (RBA) decided to keep the official cash rate at the record low 1.5%.

Today, the Australian Bureau of Statistics will release its third-quarter GDP report, with economists expecting this report to show a slowdown in growth this quarter.

Company news

H2-Pharma, is an American generic pharmaceuticals distribution company, has acquired the exclusive rights to distribute fifteen products from Mayne Pharma Group (ASX:MYX). H2-Pharma has already launched three of these products and expects to launch the remaining twelve under its own brand by the end of this year. Shares in Mayne Pharma closed 1.34% lower at $1.48.

CSG Ltd (ASX:CSV), which provides managed technology, print, and cloud solutions, has has entered a deal with Officeworks. CSG will provide communications and technology subscription bundles to the Officeworks customer base in Australia, and this deal is not expected to have any material impact on FY17 earnings. Shares in CSG closed 2.94% higher at $0.70.

Ex-dividends

Two companies are going ex-dividend today:

Collins Foods Ltd (ASX:CKF) will pay a fully franked dividend of 8 cents per share.
MCS Services Ltd (ASX:MSG) will pay an unfranked dividend of 0.32 cents per share.

Commodities

Gold is down $5.20 to $US1,171 an ounce.
Silver has lost $0.13 to $16.77.
Copper is flat at $2.67.
Oil is down $1.06 to $50.73 per barrel.