Mostly positive: Aus shares to open higher

Market Reports

by Kathy Skantzos

Wall Street had a mostly positive day of trade yesterday, with the Dow closing the session 80 points higher. The S&P 500 closed flat and the Nasdaq recorded gains. This came as the Federal Reserve lifted the interest rate target range by a quarter of a per cent, as well as raising the GDP outlook for 2018. AT&T and Verizon both closed lower after T-Mobile announced the acquisition of Layer3 TV. Australia’s futures are tracking higher, setting the day of trade up for a positive start.

On the commodities front, oil is tracking lower and gold is more than a per cent higher. Iron ore is about a quarter of a per cent higher.

US economic news

The inflation rate increased 2.2 per cent in November, which was widely expected. The Federal Reserve increased the interest rate by a quarter of a per cent to a 1.25-1.5 range. Fed Reserve Chair Janet Yellen said the labor market has continued to strengthen and that economic activity has been rising at a solid rate. The central bank forecasts three rate hikes in 2018.

Local economic news

Consumer inflation expectations will be out, which decreased to 3.7 per cent in November. Unemployment figures will also be out, which unexpectedly fell in October to 5.4 per cent.


Wall Street closed mostly higher yesterday: The Dow Jones Industrial Average gained 0.3 per cent to close at 24,585, the S&P 500 lost 0.05 per cent to close at 2,663 and the NASDAQ gained 0.2 per cent to close at 6,876.

European markets closed lower: London’s FTSE lost 0.1 per cent, Paris lost 0.5 per cent and Frankfurt dropped 0.4 per cent.

Asian markets closed mixed: Tokyo’s Nikkei dropped 0.5 per cent, Hong Kong’s Hang Seng gained 1.5 per cent, and China’s Shanghai Composite gained 0.7 per cent.

And back home, the Australian share market closed higher yesterday: The S&P/ASX 200 Index closed 9 points up to finish at 6,022.

On the futures market the SPI is 21 points up.

Company news

Dairy producer A2 Milk (ASX:A2M) has announced a new Managing Director and CEO to succeed Geoffrey Babidge who will retire from his role in 2018. Jayne Hrdlicka who will take on the role has senior executive experience including over five years as CEO of Jetstar Group and has served as non-executive director of Woolworths. Earlier in her career Jayne was a partner at Bain & Company in the US. Shares in A2 Milk (ASX:A2M) closed 0.42 per cent lower to $7.07.

New Zealand electricity generator Meridian Energy (ASX:MEZ) has reported a drop in national hydro storage in the month of December, from 104 per cent to 90 per cent of the historical average. Sales volumes increased by 18.5 per cent in November compared to the same time the previous year, a reflection of higher electricity demand. Shares in Meridian Energy (ASX:MEZ) closed 1.82 per cent lower to $2.70.


Five companies are going ex-dividend today:

BPS Technology (ASX:BPS) is paying 2.25 cents fully franked,
Iron Mountain (ASX:INM) is paying 53.27 cents unfranked,
Metcash (ASX:MTS) is paying 6 cents fully franked,
Turners Automotive (ASX:TRA) is paying 2.31 cents fully franked, and
Tatts Group (ASX:TTS) is paying 16 cents fully franked..


One Australian Dollar at 8:45AM was buying 76.39 US cents, 56.95 Pence Sterling, 85.99 Yen and 64.60 Euro cents.


Gold has gained $16.60 to $US1,258 an ounce.
Silver has gained $0.42 to $US16.09 an ounce.
Oil has lost $0.45 to $US56.71 a barrel.