The Australian share market is likely to continue its winning streak in early trade, after US stocks edged higher following a raft of mediocre earnings reports.
Despite the mild trading, the gains pushed the S&P 500 to a fresh record.
Investors were less than impressed by earnings from McDonald’s as well as the latest data showing that sales of existing homes in the US slipped in June, falling short of analyst expectations.
US economic news
The number of sales dipped 1.2 per cent to an annual rate of 5.08 million in June from a downwardly revised 5.14 million in May. But sales were up 15.2 per cent compared to June, 2012.
Currencies
The Australian dollar lifted on that disappointing data, putting pressure on the greenback. At 7:15AM the Aussie was buying $US92.52 cents, 60.25 Pence Sterling, 92.16 Yen and 70.18 Euro cents.
Figures
Wall Street took baby steps: The Dow Jones Industrial Average added 2 points to close at 15,546, the S&P 500 lifted by 3 points to close at 1,696 and the NASDAQ climbed 13 points higher to close at 3,600.
European markets were also tepid: London’s FTSE lost 8 points, Paris gained 15 points and Frankfurt lost half a point.
There was green on the screens across Asian markets: Tokyo’s Nikkei added 68 points, Hong Kong’s Hang Seng gained 54 points, and China’s Shanghai Composite lifted by 12 points.
The Australian share market closed at its highest level in two months yesterday, after spending the session above the 5,000 mark. The S&P/ASX 200 index closed 30 points up to finish at 5,002.
On the futures market the SPI is 14 points higher.
Company news
Fortescue Metals Group Limited
(ASX:FMG) will report its June quarter results today. It’s expected to confirm that full-year iron ore production was between 80 million and 82 million tonnes over the 12 months to June 30. Shares in Fortescue have fallen 20 per cent this year amid concerns about a slow-down in China and they continued to slide yesterday, closing 1.08 per cent down at $3.68.
Oil Search Limited
(ASX:OSH) will release its second quarter production report today. It comes amid forecasts the company will quadruple its energy production from 2015 as the PNG LNG project comes online. Shares in Oil Search have increased 25 per cent in the last 12 months and lifted 1.11 per cent yesterday to close at $8.23.
Commodities
Gold prices saw their biggest one-day gain in more than a year, as a technical breakout above $US1,300 triggered a rush from funds and speculators to buy back their bearish bets. Gold is up $43.10 to $US1,336 an ounce for the August contract on Comex. Silver is up $1.04 to $20.51 for September. Copper is up $0.04 at $3.18 a pound. Oil is down $1.14 at US$106.91 a barrel for August light crude in New York.
