Local shares are poised to edge higher at the open, bolstered by Wall Street which advanced on a slew of positive economic data and corporate news.
What you need2know:
• SPI futures up 11 points to 5616
• AUD at 93.00 US cents, 96.57 Japanese yen, 70.02 Euro cents and 56.08 British pence.
• On Wall St, S&P 500 +0.3%, Dow +0.4%, Nasdaq +0.1%
• In Europe, Euro Stoxx 50 +1.3%, FTSE +0.3%, CAC +1.2%, DAX +0.9%
• Spot gold fell 1.2% to $US1277.75 an ounce
• Brent oil added 0.4% to $US102.70 per barrel
• Iron ore slipped 0.4% to $US91.90 a metric tonne
What’s on today
Australia: Santos, Iluka, Sims Metal, IOOF, QUBE Holdings, Federation Centres report earnings;
EU August consumer confidence,
US July existing home sales, US July leading index, US August Philadelphia Federal business outlook.
Stocks to watch
James Packer’s Crown Resorts has squeezed a 17-year extension on its Melbourne casino licence out of the Victorian state government.
Medibank Private is considering potential retail incentive structures to entice mum and dad shareholders to participate in the group’s expected $4 billion float.
Shaw Stockbroking has a kept its “sell” recommendation on engineering services company Monadelphous Group and rates it “high risk” with a price target of $15.60 a share.
RBC Capital Markets maintained an “outperform” on Fortescue Metals Group with a price target of $6.00 a share after it reported 2014 financial results.
Currencies
The latest German data helped the euro rebound against the US dollar, rising 0.17 per cent to $US1.3281. Against the yen, the greenback gained 0.11 per cent to 103.84 yen.
US Treasuries hewed to a tight range, showing little reaction to the stronger-than-expected US economic data. Investors awaited developments from the annual meeting of central bankers in Jackson Hole, Wyoming, which begins late Thursday there.
A speech on Friday by Federal Reserve chair Janet Yellen, when she is expected talk about labour markets, is highly anticipated by investors.
German 10-year Bund yields held below 1 per cent on bets that Yellen will signal at the Jackson Hole central bankers' gathering that the Fed is in no hurry to raise rates. Benchmark 10-year US Treasuries rose 6/32 in price to yield 2.4068 per cent.
Commodities
For a market supposedly facing an imminent and dramatic supply shortfall, there sure is a lot of nickel around. London Metal Exchange stocks continue to power relentlessly upwards, every couple of days bringing a fresh record high. At 324,714 tonnes, they have risen by over 63,000 tonnes, or 24 per cent, since the start of the year.
Deutsche Bank has sold its North American natural gas trading book to Morgan Stanley, a source familiar with the deal said on Thursday in New York.
Former BHP Billiton chairman Don Argus says the mining giant’s controversial decision to spin off a $US15 billion resources company is “a very inspired move” and will create value in a suite of assets overlooked by the market. About 60 per cent of BHP Billiton is owned by Australian investors.
United States
US stocks closed higher on Thursday, with the S&P 500 ending at a record on a flurry of positive economic data. Trading was light as investors waited for possible clues about interest rates from central bankers attending an annual meeting in Jackson Hole, Wyoming.
The National Association of Realtors said existing home sales increased 2.4 per cent to an annual rate of 5.15 million units. That was the highest reading since last September and confounded economists’ expectations for a pullback.
Bank of America has reached a $US16.65 billion settlement with US regulators to settle charges that it misled investors into buying troubled mortgage-backed securities.
EBay is considering spinning out its fast-growing payments unit PayPal as soon as next year, news website The Information reported, citing sources.
Europe
While the composite PMI in Germany fell to 54.9 from 55.7,the nation's private sector grew for a 16th straight month in August, suggesting Europe’s largest economy could expand robustly in the third quarter after it suffered a surprise contraction in the second.
The economic news helped European stocks ended higher on Thursday but traders remain cautious.
For FXCM analyst Nicolas Cheron, however, the market rebound seen in the past two weeks remains fragile and European stocks continued to underperform Wall Street. “The ‘long US shares/short European shares’ pairs trade has worked well and this should continue for a while. European indexes are still a good 6 to 8 per cent below their recent peaks while Wall Street benchmarks are at record highs,” he said.
What happened yesterday
Australian shares edged ahead on Thursday to extend their latest winning streak to a sixth straight day. Some pleasing profit results, including from AMP, helped the market hang on to a small gain despite pressure from a regional sell-off.
The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index each closed up less than 0.1 per cent at 5638.9 points and 5634 points respectively.
