Australian stocks are expected to open stronger this morning as Wall Street closed higher after the Federal Reserve announced interest rates will remain unchanged near zero per cent.
Affecting US shares was the latest economic news. New home sales fell 7.6% to a seasonally-adjusted rate of 342,000 in December from 370,000 in November.
Ranking as the top two drags on the Dow were Caterpillar and United Technologies. Caterpillar posted stronger-than-expected earnings but forecast 2010 profit below expectations. United Tech posted a 6% drop in quarterly profit and its finance chief warned of a "tough" first quarter.
Checking the figures, the Dow Jones Industrial Average rose 42 points to 10,236. The S&P500 Index rose 5 points to 1,098 and the NASDAQ is 18 points higher at 2,221.
To other international markets, Europe was lower. London’s FTSE fell 59 points Paris lost 47, and Frankfurt is down 26 points.
Asian markets are also weaker with Hong Kong’s Hang Seng down 76 points, Tokyo’s Nikkei fell 73 and China’s Shanghai Composite is down 33 points.
The Austraian share market shares fell yesterday on concerns about global events. The S&P/ASX 200 Index finished 73 points weaker at 4,645 and on the futures market the SPI200’s 16 points higher.
On to currencies: the Aussie Dollar at 8:35AM was buying 89.48 US cents, 80.51 Yen, 63.83 Euro cents and 55.36 Pence Sterling.
In company news about this morning:BHP Billiton (ASX:BHP) shares fell 2.3% yesterday to close at $40.30. BHP Billiton has played down expectations it will reduce the range of iron ore products available under its joint venture with Rio Tinto as it becomes a key issue in the European Competition Commission's investigation into the deal. Analysts believe that BHP and Rio plan to rationalise their sales to fewer iron ore products after combining their operations in WA’s Pilbara region. A reduction in the choice of iron ore grades has raised concern among steel making facilities who argue that BHP and Rio are lessening competition. Yesterday a BHP spokesperson minimised the prospects of the miner reducing its offering by saying that owners will seek to standardised products as soon as practical. BHP Billiton’s 2009 net profit was $7.2 billion.
CSR (ASX:CSR) shares lost 2.35% yesterday to close at $1.87. China's Bright Food has warned it won't e making a revised bid for CSR's sugar business, indicating that hopes of a $1.5 billion sale are dead.The Australian Financial Review is quoting a source close to the deal as saying that Bright Food has done everything possible to get CSR to come to the table but it hasn’t been successful. CSR said yesterday it will push ahead with its planned demerger of its sugar and renewable energy business after recent talks with Bright Food. CSR made a $326 million loss in 2009.
Taking a look at ex-dividends: Djerriwarrh Investments is going ex-dividend tomorrow with a 10 cent fully franked dividend.
To commodities: Gold fell $13 to just over US$1,086 an ounce for the April contract on Comex. For the March contract silver lost 44 cents to US$16.43 and copper is down 11 cents at US$3.23.
The price of oil fell by just over $1 dollar to US$73.70 a barrel for March light crude in New York.
