Outlook: Shares set to open the week higher

Market Reports

The Australian share market is expected to open the week higher today thanks to positive offshore leads. Wall St celebrated the latest earnings results from investment banking giant JP Morgan and also cheered encouraging industrial production figures on Friday night. The initial enthusiasm is expected to wane as market players look out for latest updates on the floods across Australia.

US economic news: On Friday, the Federal Reserve reported that US industrial production increased 0.8 per cent in December, after having risen 0.3 per cent in November. For the fourth quarter as a whole, industrial production increased at an annual rate of 2.4 per cent.

On Friday, the Dow Jones Industrial Average, closed 55 points higher to 11,787. S&P500 gained 9 points to close 1,293 and the NASDAQ up 20 points to close 2,755.

European stocks were mixed: London’s FTSE fell 22 points, Paris up 8 and Frankfurt was flat.

To Asian markets, stocks were mixed: Hong Kong’s Hang Seng up 44 points, Tokyo down 91 points and China’s Shanghai Composite down 36 points.

The Australian share market finished stronger on Friday. The S&P/ASX 200 Index lifted 6 points to close at 4,802 and on the futures market the SPI was up 11 points. Currencies: Aussie Dollar at 7:35AM was buying 99.14 US cents, 62.49 Pence Sterling, 82.09 Yen and 74.01 Euro cents.

Local economic news: The Australian Bureau of Statistics will be releasing its latest round of building data as well as a private-sector measure of inflation.

Company news: On Friday shares in Qantas Airways Ltd (ASX:QAN) closed 0.4 per cent lower at $2.51. Qantas has experienced another engine failure, this time as it was preparing to take off at Sydney Airport. On Saturday, flight QF11 to Los Angeles, carrying 344 passengers was preparing to take off when one of its engines’ suffered a complete failure. Passengers described hearing a ‘loud bang’ before seeing black smoke pour out of the crippled engine. A spokeswoman for Qantas said a replacement aircraft was arranged for all passengers. For the year ended 30 June 2010, Qantas reported a net profit of $116 million.

On Friday shares in Hutchison Telecommunications (Australia) Ltd (ASX:HTA) closed 0.04 per cent lower at $0.095. Hutchison’s subsidiary Vodafone has moved to urgently overhaul its security systems, according to a report in Fairfax Media. The newspaper reports that a series of breaches lead the firm to order daily password changes and scrap shared access logons. Last week, Vodafone fired a number of its staff in New South Wales for hacking into databases to illegally access customer information. The company has launched an investigation to determine whether any of its employees sold customer database passwords to criminals or released them on the internet. For the half year ended 30 June 2010, Hutchison reported a net profit of $17.9 million.

Ex-dividends: There are two companies going ex-dividend today. Euroz Ltd (ASX:EZL) with a 3 cent fully franked dividend and Merchant House International Ltd (ASX:MHL) with a half cent unfranked dividend.

Commodities: Gold is down $26.50 to $US1,360 an ounce for the February contract on Comex, silver is down $0.94 to $28.32 for March and copper is up $0.04 cents to $4.41 a pound. Oil is up $0.14 at $US91.54 a barrel for February light crude in New York.

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