The Australian share market is set to soar at the open, after strong leads from the US, with Wall Street pushing further into record territory following some encouraging economic news.
US economic data
Fresh data from the Department of Labor said US import prices declined 0.5 per cent in April, while US export prices fell 0.7 per cent.
Australian economic news
Treasurer Wayne Swan delivered his sixth federal budget last night, with a forecast of a $19.4 billion deficit for the current year. That’s 1.3 per cent of GDP, an about turn from the $1.1 billion surplus forecast in November’s mid-year outlook.
Mr Swan says the nation’s largest resource investment boom is shifting to a boom in production and exports, and as a result the economy is transitioning towards broader sources of economic growth.
We’ll have a full budget report for you later this morning.
The Australian Bureau of Statistics will release new car sales data for April and it’s day 2 of the RIU Resources Round Up conference in Sydney - FNN will bring you updates from the conference throughout the day.
Figures
The Dow Jones Industrial Average gained 124 points to close at 15,215, the S&P 500 added 17 points to close at 1,650 and the NASDAQ gained 24 points to close at 3,463.
London’s FTSE added 54 points, Paris gained 21 points and Frankfurt was up by 60 points.
Hong Kong’s Hang Seng lost 60 points, Tokyo’s Nikkei shed 24 points and China’s Shanghai Composite lost 25 points.
The Australian share market had a low key day of trade yesterday. The S&P/ASX 200 index closed 11 points up to finish at 5,221.
On the futures market the SPI is 30 points higher.
Currencies
The Australian Dollar at 7:20AM was buying $US98.94 cents, 65.07 Pence Sterling, 101.34 Yen and 76.58 Euro cents.
Company news
BHP Billiton Limited
(ASX:BHP) chief executive Andrew Mackenzie is promising to cut capital and exploration spending by as much as $7 billion annually within the next three years. Mr Mackenzie told a conference in Barcelona that capital and exploration spending for the 2014 financial year will decline to about $US18 billion, down from $US22 billion in 2013, with more cuts to follow. Shares in BHP rose 0.35 per cent yesterday to close at $34.67.
Rio Tinto Limited
(ASX:RIO) chief executive Sam Walsh has softened his stance on plans to boost iron ore production. Mr Walsh says depending on market conditions, the miner could choose to develop new mines to quickly deliver tonnes or conserve cash and fill some capacity with incremental tonnes from existing mines.Rio is seeking to boost annual iron ore output to 360 million tonnes by 2015. Shares in Rio Tinto slipped 0.07 per cent yesterday to finish at $57.55.
Ex-dividend today ResMed Inc
(ASX:RMD) will pay $1.45 per share unfranked.
Commodities
Gold is down $9.80 to $US1,424.50 an ounce for the June contract on Comex. Silver is down $0.32 to $23.38 for July. Copper is down $0.07 at $3.29 a pound. Oil is down $0.96 at $US94.21 a barrel for June light crude in New York.
