Outlook: Aus shares to open in positive territory

The Australian share market is likely to begin the day of trade on a positive note after global markets rallied on solid earnings and better-than-expected economic data, with stock indexes in the US, Germany and Japan soaring to fresh records.

 

Figures

The Dow Jones Industrial Average added 87 points to push through the 15,000 mark for the first time closing at 15,056, the S&P 500 gained 8 points to close at 1,626 and the NASDAQ was up by 4 points to close at 3,397.

 

European markets were also higher: London’s FTSE added 36 points, Paris gained 14 points and Frankfurt had a stellar session adding 70 points after German factory orders data beat expectations.

 

Asian markets also soared: Hong Kong’s Hang Seng added 132 points, Tokyo’s Nikkei added 486 to break above 14,000 for the first time as the market played catch-up from the Golden Week public holiday, digesting positive global economic data. China’s Shanghai Composite added 5 points.

 

The Australian share market climbed back from session lows to finish relatively flat yesterday after the RBA’s surprise decision to cut the official cash rate to a record low of 2.75 per cent. The S&P/ASX 200 index closed 13 points down to finish at 5,144. On the futures market the SPI is 24 points higher. 

 

Currencies

The Australian Dollar at 7:20AM was buying $US1.018 cents, 65.82 Pence Sterling, 100.85 Yen and 77.92 Euro cents.

 

Company news

 

Perpetual Limited (ASX:PPT) will buy Trust Company Limited (ASX:TRU) after the board unanimously recommended the proposed deal. As part of the takeover, Perpetual says Trust Company shareholders will receive 0.1495 Perpetual shares for each share in Trust Company plus a fully-franked special dividend of $0.22 per share. That values Trust Company shares at $6.39, representing a 34.5 per cent premium. Shares in Perpetual closed down 0.63 per cent yesterday at $41.01.

 

 

Billabong International Limited (ASX:BBG) is expected to announce the outcome of takeover talks with a group of suitors led by the company's former United States' boss Paul Naude. Billabong is in a trading halt pending a further announcement on possible transactions affecting the company. Shares in Billabong last traded at $0.455.

 

Commodities

Gold is down $19.20 to $US1,449 an ounce for the June contract on Comex. Silver is down $0.15 to $23.81 for July. Copper is down $0.01 at $3.31 a pound. Oil is down $0.54 at $US95.62 a barrel for June light crude in New York.