After a gain of 0.8 per cent over last week the Australian share market looks to continue trading higher today. Despite a backdrop of geopolitical tensions Wall Street rebounded from Thursday’s sell-off and advanced on Friday to post a weekly gain.
Equity market gains came despite Israel's Gaza invasion and the shooting down of a Malaysian Airlines passenger jet over Ukraine. Across commodity markets prices are lower with gold widening last week’s decline and iron ore losing almost 1 per cent.
Over the coming week local investors will hear from Reserve Bank of Australia Governor Stevens tomorrow before second quarter inflation figures are released on Wednesday.
Global markets
Wall Street rallied over last week. On Friday the Dow Jones Industrial Average rose 0.7 per cent to close at 17,100, the S&P 500 rose 1 per cent to close at 1,978 and the Nasdaq rose 1.6 per cent to close at 4,432.
European markets rose over last week but closed mixed on Friday: London's FTSE 100 added 0.2 per cent, France's CAC 40 added 0.4 per cent and Germany's DAX lost 0.4 per cent.
Asian markets also gained over last week but ended mixed on Friday: Japan’s Nikkei fell 1 per cent, Hong Kong’s Hang Seng slipped 0.3 per cent, and China’s Shanghai Composite firmed 0.2 per cent.
The Australian share market recovered from earlier losses to end stronger at the end of last week: The S&P/ASX 200 index added 9 points on Friday, building on the weekly gain of 44.8 points to close at 5,532. On the futures market the SPI is 22 points higher.
Currencies
Having lost about $0.002 over last week the Australian dollar at 7:20am was buying $US0.94, 55.05 Pence Sterling, 95.27 Yen and 69.5 Euro cents.
Economic news due out today
Commsec: State of the States report for July
Company news
BHP Billiton Limited
(ASX:BHP) is expected to exceed its annual iron ore export target of 217 million tonnes when the miner releases its production report this Wednesday. Australia’s largest company will post its final June quarter output results this week ahead of its financial results due on August 19. The figures come after the resources sector last week rose more than 2 per cent following a series of well received output numbers and better than expected Chinese growth data. Rival miner Rio Tinto Limited
(ASX:RIO) last week revealed a 10 per cent rise in first half production on the back of record iron ore results from its Pilbara mines. Shares in BHP Billiton dipped 0.42 per cent to close at $38.39 on Friday.
Wesfarmers Limited
(ASX:WES) chief and B20 Australia Chair Richard Goyder has outlined 20 recommendations for action by G20 leaders. As part of the Business 20 event held in Sydney last week Mr Goyder has detailed the new proposed structural reform measures to drive growth and create jobs.
Mr Goyder says the measures would deliver on the G20 growth target and form a blueprint for sustainable economic growth in the medium term. Recommendations include a focus on structural flexibility and freedom of movement within an effective regulatory framework which promotes transparency in commerce. Shares in Wesfarmers rose 0.42 per cent to close at $43.47 on Friday.
Commodities
After dropping about $US25 over last week the price of gold has fallen $7.50 to $US1,309 an ounce for the August contract on Comex.
Silver has slipped $0.20 to $20.93 for September.
Copper has dipped $0.04 to $3.18 a pound.
Oil has eased $0.06 to $US103.13 a barrel for August light crude in New York.
