Earnings beat the street, S&P closed at record high: ASX to rally

Market Reports

by Jessica Amir

The Australian share market is set for a very healthy rally at the open, with the SPI futures tipping a rise of over 40 points.

It comes as the S&P 500 on Wall Street closed at a record high, with financials, materials and energy gaining over 1 per cent with earnings beating street forecast.

The Dow Jones rose over 100 points with Caterpillar and McDonald's reporting better than expected earnings results, which propped the index up.

As for the tech heavy Nasdaq, it closed around the break even mark, but despite that it managed to etch an intraday and record close.

Wall Street is also awaiting the Federal Reserve’s two-day monetary policy meeting and what comes out of the central-banks discussions.

US economic news

Major metro area home prices rose 5.7 per cent year-on-year in May. The index measures home prices in 20 cities across America. Despite the rise in May, it actually fell from April’s 5.8 per cent.

US consumer confidence has risen to a 16-year high. It comes as the index rose to 121.1 in July, smashing through expectations it would drop 116.5

Local economic news 

We can expect the ABS to reveal the closely watched Consumer Price Index, inflationary data reading for the June quarter.

Also on today, The RBA Governor will deliver a speech called, ‘The Labor Market and Monetary Policy’. Investors will be eyeing comments about how far off interest rates changes are.

Markets 

Wall Street closed higher, The Dow Jones Industrial Average gained 0.5 per cent to close at 21,613, the S&P 500 added 0.3 per cent to close at 2,477 and the NASDAQ advanced 0.02 per cent to close at 6,412.

European markets closed higher: London’s FTSE gained 0.8 per cent, Paris added 0.7 per cent and Frankfurt added 0.5 per cent.

Asian markets closed mixed: Tokyo’s Nikkei lost 0.1 per cent, Hong Kong’s Hang Seng closed flat, and China’s Shanghai Composite fell 0.2 per cent.

And back home, the Australian share market closed higher on Tuesday: At the closing bell, The S&P/ASX 200 Index closed 39 points up or 0.7 per cent higher for the day at 5,727.

On the futures market the SPI is 42 points up.

Company news

BC Iron (ASX:BCI) has reported cash flow positive results for the June 2017 quarter, despite undertaking significant development activities and repayment of deferred royalties to the Western Australian Government. The iron ore miner increased its cash balance for 30 June 2017 to $36.4 million. For BC Iron’s Central Pilbara mine, Iron Valley, its EBITDA was $18.4million for FY17. For the quarter its EBITDA contributed $1.4 million to the overall yearly figure. Shares in BC Iron (ASX:BCI) last traded flat at $0.16

Ex-dividends

One company is going ex-dividend today: Mirrabooka Investments (ASX:MIR) is paying 10.5 cents fully franked.

Currencies

One the Australian Dollar at 7:40AM was buying 79.37 US cents, 60.93 Pence Sterling, 88.79 Yen and 68.16 Euro cents.

Commodities

Gold has lost $4.60 to $US1,256 an ounce.
Silver has gained 3 cents to $US16.48 an ounce.
And Oil has added $2.21 to $US48.55 a barrel.
 

Jessica Amir

Finance News Network
Jessica joined FNN in January 2017 after having worked in financial advising for seven years and in TV journalism for seven years, specialising in finance, equities and analysis. She has interviewed former Prime Ministers of Australia, Tony Abbott, Julia Gillard and Kevin Rudd and ex Treasurer Jo Hockey. Jessica has worked as a journalist with Sky News Business, ABC 1, ABC's The Business, ABC24 and has also been a regional Channel 7 and 9 TV reporter with Prime7 and Win News.