The Australian share market is expected to win back yesterday’s losses today, after US stocks made gains on solid earnings reports and optimism the Federal Reserve will continue its stimulus measures.
IBM gave the Dow a boost, announcing an additional $US15 billion share repurchase plan and the S&P 500 set its third consecutive record-high finish.
US economic news
US stocks gained despite an unexpected 0.1 per cent decline in retail sales in August. Economists had forecast a 0.1 per cent rise.
Meantime, the October consumer confidence index fell more than expected to 71.2 - a six-month low - from September's 79.7.
The producer price index for September also dropped, falling 0.1 per cent. That went against expectations for a 0.2 per cent rise.
It wasn’t all bad news though - the S&P Case-Shiller city home price index for August rose 12.8 per cent on year, slightly more than forecasts.
But investors will be looking ahead to a statement from the Fed tomorrow morning local time, as the two-day meeting of the central bank's policy-setting committee ends. The Fed is widely expected to keep stimulus measures, including its $85 billion-a-month bond-purchasing program.
Figures
Wall Street was buoyant: The Dow Jones Industrial Average added 111 points to close at 15,680, the S&P 500 lifted by 10 points to close at 1,772 and the NASDAQ gained 12 points to close at 3,952.
European markets traded broadly higher as investors looked past mixed earnings updates and instead bet on further support from central banks. London’s FTSE jumped 49 points, Paris added 26 points and Frankfurt gained 43 points.
Asian markets were mostly lower: Tokyo’s Nikkei dropped 70 points, Hong Kong’s Hang Seng lifted by 40 points, and China’s Shanghai Composite fell by 5 points.
The Australian share market closed half a per cent lower yesterday, as investors remained tentative ahead of an announcement from the US Federal Reserve. The S&P/ASX 200 index closed 26 points down to finish at 5,416. On the futures market the SPI is 26 points up.
Currencies
The Australian dollar is holding below 95 US cents, after dropping below the threshold for the first time in three weeks after RBA Governor Glenn Stevens said the persistently high currency would eventually get weaker. At 8:20AM the Aussie was buying $US94.87 cents, 59.14 Pence Sterling, 93.14 Yen and 69.03 Euro cents.
Company news
Crown Limited
(ASX:CWN) will hold its annual general meeting in Melbourne today. It comes amid reports the company is in talks with the Sri Lankan Government and potential joint venture partners over the development of a five star resort in Colombo. Shares in Crown fell 1.63 per cent yesterday to close at $16.33.
Australia and New Zealand Banking Group
(ASX:ANZ) chief executive Mike Smith says the bank will continue to push into Asia, saying it’s a critical part of the plan to lift shareholder returns. The comments came after ANZ unveiled a record $6.5 billion full-year cash profit and sharply higher dividends. Shares in ANZ lifted to record highs throughout yesterday’s session and closed 1.17 per cent stronger at $33.63.
Commodities
Gold is down $6.70 to $US1,346 an ounce for the December contract on Comex. Silver is down $0.05 to $22.49 for December. Copper is up $0.01 at $3.28 a pound. Oil is down $0.48 at US$98.20 a barrel for December light crude in New York.
