The Australian stock market is expected to open in positive territory this morning after investor confidence boosted US stocks overnight.
Wall Street rallied with the Dow logging triple-digit gains, as European debt noise faded and investors focused on an improving domestic economy and corporate earnings.
In economic news, the Commerce Department says the trade deficit increased 2.5% in March widening to $40.4 billion from $39.4 billion in February. That was lower than the $40.5 billion that many analysts had expected.
The Dow Jones Industrial Average finished 149 points higher at 10,897. The S&P500 Index rose 16 points to 1,172 and the NASDAQ is up 50 at 2,425.European stock markets finished stronger. London’s FTSE lifted 49, Paris rose 41 points and Frankfurt jumped 146 points.
To our local region and Asian markets were mixed. Hong Kong’s Hang Seng gained 66 points, Tokyo’s Nikkei fell 17 and China’s Shanghai Composite rose 8 points.
The Australian share market closed higher yesterday. The S&P/ASX 200 Index closed 25 points higher at 4,573 and on the futures market the SPI200 is up 59 points. On to currencies: the Aussie Dollar at 8:40AM was buying 89.54 US cents, 60.33 Pence Sterling, 83.42 Yen and 70.84 Euro cents.
In local economic news, the Bureau of statistics is due to release its April labour force data today.
To company news around this morning: Shares in IMF Australia (ASX:IMF) closed 10.1% higher to $1.58 yesterday. The Herald is reporting that the phone lines at IMF Australia have been swamped by thousands of caller after news broke yesterday that the litigation firm is bankrolling the biggest class action against Australian banks in the country’s history. The litigation funder aims to claw back $400 million and has agreed to pay for a series of class actions against 12 banks, alleging they have overcharged millions of customers in penalty and late fees. The class action will target banks, including the ANZ, Commonwealth Bank, National Australia Bank and Westpac, foreign banks and the regional banks. IMF chief executive Hugh McLernon says since the announcement it's been bedlam at the firm with a huge amount of interest because of pent up anger over banks fees. Similar class actions have already been launched in Britain and the US. IMF Australia posted a $20 million profit in 2009.
Shares in Myer (ASX:MYR) closed 0.33% lower to $3.06 yesterday. The battle for high end fashion labels is heating up as Myer’s apparel boss rejects claims that she was distraught after being told that the retailer had lost another designer to David Jones. The latest label to switch is Armani Jeans, which has been offered an exclusive deal at DJs. The Australian Financial Review says there have been 30 leading brands leave Myer for David Jones over the past three years. But Myer’s Judy Coomber has dismissed concerns about the loss of Armani saying that labels come and go in any business. On the other hand, David Jones chief executive Mark Innes says the agreement with Armani cements DJ’s position as the home of international brands in Australia. Myer is under pressure as its shares trade well below last year’s $4.10 float price. Myer achieved a net profit of $104 million in 2009.
There’s just one company going ex-dividend tomorrow and that’s Incitec Pivot with a 1.8 cent unfranked dividend. To commodities, and the price of gold jumped $22.80 to US$1,242.70 an ounce for the May contract on Comex. Silver is up 37 cents at US$19.64 and copper is 2 cents lower at US$3.18.
And finally oil dropped 72 cents to US$75.65 a barrel for June light crude in New York.
