The Australian share market is set to build on its gains today, after US stocks soared, with the S&P 500 closing at a fresh high after strong earnings from Bank of America and a solid set of economic data.
World economic news
US investors were buoyed by the release of the Producer Price Index for December, which lifted by 0.4 per cent, broadly in line with expectations.
Meanwhile, the World Bank is estimating global economic growth will hit 3.2 per cent this year, a substantial increase compared to the previous year’s 2.4 per cent.
Currencies
The Australian dollar lost more ground overnight amid that strong US and global economic outlook and concerns over the World Bank’s downward revision to Chinese growth. At 8:20AM the Aussie was buying $US89.16 cents, 54.46 Pence Sterling, 93.26 Yen and 65.54 Euro cents.
Figures:
Wall Street rallied: The Dow Jones Industrial Average gained 108 points to close at 16,482, the S&P 500 added 10 points to close at 1,848 and the NASDAQ lifted by 32 points to close at 4,215.
European shares hit fresh 5-and-a-half year highs, following strong data and the World Bank’s brighter outlook for the global economy. Investors also got a boost amid easing regulatory concerns about eurozone banks. London’s FTSE lifted by 53 points, Paris gained 58 points and Frankfurt surged by 193 points.
Asian markets were mixed: Tokyo’s Nikkei added 386 points, Hong Kong’s Hang Seng pushed up by 111 points, but China’s Shanghai Composite shed 3 points.
The Australian market recovered somewhat yesterday and ended 0.6 per cent higher with broad-based gains. The S&P/ASX 200 index lifted by 33 points yesterday to end the session at 5,245. On the futures market the SPI is 24 points higher.
Economic news
Local economic news will be the focal point today with the Australian Bureau of Statistics set to release labour force data for December. Economists are tipping the unemployment rate to remain at 5.8 per cent.
Meantime, TD Securities Melbourne Institute inflation gauge for December will be released, ahead of next week's official inflation data.
Company news
Newcrest Mining Limited
(ASX:NCM) has maintained its gold and copper production guidance, saying it expects gold production to come in at the top end of its guidance range. Production for the December quarter totaled over 621,000 ounces of gold and more than 22,500 tonnes of copper. Shares in Newcrest fell 3.07 per cent yesterday to close at $8.53.
Qantas Airways Limited
(ASX:QAN) has lifted the fuel surcharge on some international flights between Australia and Europe, Asia and the Middle East, according to media reports. The Australian airline has reportedly told travel agents and industry partners about the planned fee hike. Shares in Qantas closed flat yesterday at $1.10.
Ex-dividend Tower
(ASX:TWR) will pay 4.73 cents per share unfranked.
Commodities
Gold is down $7.10 to $US1,238 an ounce for the February contract on Comex. Silver is down $0.14 to $20.13 for March. Copper is up $0.02 at $3.36 a pound. Oil is up $1.58 at US$94.17 a barrel for February light crude in New York.
