The Australian share market looks set to extend last week’s gains today, after US stocks rallied on hopes of an end to the partial US government shut-down and a resolution to debt ceiling talks.
While both sides of US politics appear in agreement that the debt ceiling should be raised and the government reopen, they remain at odds over the terms for doing so, including the duration of the debt ceiling increase and levels of funding for the government.
There are just three working days left to raise the debt ceiling before the October 17 deadline.
Currencies
The Australian dollar fell as those debt ceiling talks continue in the US. At 8:20AM the Aussie was buying $US94.34 cents, 59.09 Pence Sterling, 92.78 Yen and 69.6 Euro cents.
Figures
Wall Street climbed on Friday US time as the S&P 500 ended above 1700 for the first time since late September.: The Dow Jones Industrial Average surged 111 points to close at 15,237, the S&P500 added 11 points to close at 1,703 and the Nasdaq gained 31 points to close at 3,792.
European markets followed suit: London’s FTSE jumped 57 points, Paris gained 2 points and Frankfurt lifted by 39 points.
Asian markets were also buoyed by the news of progress over lifting the US debt ceiling: Tokyo’s Nikkei added 210 points, Hong Kong’s Hang Seng surged 267 points, and China’s Shanghai Composite added 37 points.
The Australian share market maintained its big gains in afternoon trade to close 1.6 per cent higher, was investors shrugged off US President Obama’s rejection of a debt ceiling proposal from the Republicans. The S&P/ASX 200 index closed 84 points up to finish at 5,231. Over the week the index gained 23 points.
On the futures market the SPI is 33 points up.
Economic news
Australian Bureau of Statistics will release its housing finance data for August.
Company news
Australia and New Zealand Banking Group
(ASX:ANZ) ANZ’s interest rates will be left unchanged for another month. The bank decided to leave its standard variable mortgage rate at 5.88 per cent at its latest rate review meeting, after the Reserve Bank of Australia also kept the cash rate on hold at its October board meeting. ANZ's business rates also remain unchanged. Shares in ANZ jumped 2.42 per cent on Friday to close at $31.29.
The two largest supermarket chains, Woolworths Limited
(ASX:WOW) and Wesfarmers Limited
(ASX:WES) owned Coles, have renewed their grocery price war as they compete for market share, according to media reports. Both chains have increased their petrol discounts, while also cutting prices by as much as 50 per cent on numerous grocery items. Shares in Woolworths lifted by about three-quarters of a per cent (0.74 per cent) on Friday to close at $34.06.
Ex-dividend today
Commodities
Gold is down $33.70 to $US1,268 an ounce for the December contract on Comex. Silver is down $0.64 to $21.26 for December. Copper is up $0.04 at $3.27 a pound. Oil is down $0.99 at US$102.02 a barrel for November light crude in New York.
