The Australian share market is likely to open stronger this morning following a positive lead from Wall St at the end of last week and higher commodity prices.
US stocks ended a choppy session higher on Friday with gains in technology shares helping to lift the market boosted by upbeat earnings reports from Oracle and Research in Motion.
According to CNN Money volatility had been expected on Friday because of quadruple witching, which is a quarterly event in which all stock index futures and options, along with individual stock futures and options, al expire simultaneously.
The Dow Jones Industrial Average gained 21 points to 10,329. The S&P500 Index is up 6 to 1,102 and the NASDAQ closed 32 points stronger at 2,212.
European markets were lower. London’s FTSE lost 21 points, Paris declined 36 points and Frankfurt fell 13.
Asian markets were also lower: Hong Kong’s Hang Seng lost 172 points. Tokyo’s Nikkei fell 22 and the Shanghai Composite declined 65 points.
Back to the local market now and Australian stocks ended lower at the end of last week. The S&P/ASX 200 Index finished 20 points lower at 4,651. Looking at the futures market the SPI200’s up 16.
Looking at currencies; the Aussie Dollar at 8.50AM is buying 89.09 US cents, 80.52 Yen, 62.29 Euro cents and 55.27 Pence Sterling.
In economic news: the ABS releases data on sales of new motor vehicles for November.
In company news about this morning: Shares in rural services company Elders Ltd (ASX:ELD) dropped 3.33 per cent to $0.145 last Friday. The company has reiterated that it expects a recovery in earnings in the 2010 financial year. At the company’s annual general meeting Chairman Stephen Gerlach told investors that the company anticipates a recovery in earnings as the markets in which the company operates stabilise, buyer confidence returns and the prices and margins for key agricultural inputs such as fertiliser and agricultural chemicals improve. Mr Gerlach says income generation is expected to be heavily weighted in the second half of the year due to seasonal factors and as the recovery in market conditions is expected to emerge gradually as the year progresses. Mr Gerlach says trading conditions since October 1 have been consistent with these expectations of subdued activity and soft prices for the opening period of the year. Elders reported a loss of $466.43 million for fiscal 2009.
Shares in the Commonwealth Bank of Australia (ASX:CBA) gained 1.5 per cent to $52.86 last Friday. A report in The Australian says the bank has decided to wind down structured finance fuelling speculation that it may possibly exit its operations in Malta. The Australian reports sources saying that the move has been prompted by significant reputational problems associated with aggressive tax planning and the complex financial products involved. CBA set up its operations in Malta in 2007 at a time when the ATO had blacklisted Malta as a tax haven, the banks holding company in Malta, Newport, now has a balance sheet worth around $5 billion. The Commonwealth Bank posted net profit after tax for the year ended June 30, 2009 of over $4.7 billion.
Taking a look at ex-dividends now, and while there are no companies going ex-dividend today, there are a number of companies going ex-dividend on Wednesday including, APA Group and Bunnings Warehouse.
Looking at metals: Gold added $4.60 to US$1,112 an ounce for the February contract on Comex. For the March contract Silver gained 13 cents to US$17.32 and copper is up a cent at US$3.14.
And the price of oil is 71 cents stronger at US$73.36 a barrel for January light crude in New York.
