Outlook: Aus shares set for stronger start

Market Reports

The Australian share market looks set for a stronger start to the day after Wall St rallied for a third straight session. US stocks gained amid better than expected profit and economic reports, with the tech sector advancing after Microsoft's $US8.5 billion purchase of internet phone company Skype.  

Economic news: The Chinese government’s trade report revealed that the nation’s trade surplus grew for the second straight month to $11.43 billion in April 2011, from $1.68 billion in April 2010. 

US economic news: The National Association of Realtors reported that US house prices continued to slump in the March quarter. The average price of a US house has fallen 4.6 per cent from the start of last year, to $US158,700. Meanwhile, The Labor Department showed that the price of exports out of the US lifted 1.1 per cent in April, while imports into the US rose 2.2 per cent in the same month. And also, The Commerce Department said wholesale inventories increased 1.1 per cent in March, in line with expectations.

To the figures: On Tuesday, the Dow Jones Industrial Average advanced 76 points to close at 12,760, the S&P500 gained 11 points to close at 1,357 and the NASDAQ added 29 points to close at 2,872.

European stocks closed higher: London’s FTSE up 76 points, Paris up 45 and Frankfurt was up 91 points. 

To Asian markets, stocks were also higher: Hong Kong’s Hang Seng was closed, Tokyo Nikkei was up 24 and China’s Shanghai Composite was up 18.
The Australian share market finished lower on Tuesday: The S&P/ASX 200 Index fell 31 points to close at 4,726. On the futures market the SPI is 47 points stronger.
Turning to currencies and the Australian Dollar at 7:30AM was buying $1.0842 US cents, 66.27 Pence Sterling, 87.65 Yen and 75.27 Euro cents.

Company news: Yesterday shares in OZ Minerals Ltd (ASX:OZL) rose 2.94 per cent to close at $1.40. Oz Minerals has agreed to pay $60 million to settle two class actions brought against it by shareholders who claimed the copper and gold miner failed to reveal its debt position in the global financial crisis. Oz Minerals says the settlement of the class action was a commercial decision and is in no way an admission of liability. The settlement payment will be made from the company’s current cash reserves and will impact its 2011 full year net profit by the full amount. In the 2010 financial year OZ Minerals moved from a loss to a net profit of $586.9 million.

On Tuesday shares in Equinox Minerals Ltd (ASX:EQN) declined 0.38 per cent to close at $7.78. The world's largest gold miner, Canada’s Barrick Gold, has been given Australian foreign investment clearance for its $7.1 billion all-cash bid for dual listed copper miner Equinox. Barrick Gold launched the takeover at the end of last month and Equinox's board has unanimously recommended shareholders accept the offer, which will remain open for acceptance until 1 June, 2011. In the 2010 calendar year Equinox Minerals moved from a loss to a net profit of $269 million.

Ex-dividends: No companies are going ex-dividend today. Coming up tomorrow are ANZ Bank, CI Resources, Koon Holdings and RHG. 

Commodities: Gold is up $13.70 to $US1,516 an ounce for the June contract on Comex, silver is up $1.37 to $38.49 for July and copper is up $0.03 at $4.04 a pound. Oil is up $1.33 at $103.88 a barrel for June light crude in New York.

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