IG Markets: Morning Prices

In the US on Friday, the major indices finished mixed as strong results from General Electric lifted the broader market. However, weakness among technology names weighed on the NASDAQ.

The Dow Jones industrial Average was the best performer for the session and week, adding 0.4% and 0.7% respectively. The S&P 500 managed a rise of 0.2% for the session but was down for the week, declining 0.8%. The NASDAQ fell 0.6% during Friday’s session and 2.4% for the week.

Locally, the ASX 200 is called to open the week 0.2% firmer at 4766 following the generally higher lead on Wall Street.

It looks like most of today’s points are likely to come from the financial and industrial sectors after they were the best performers on Wall Street, both adding 0.8%. The financial names managed to shrug off a weaker result from Bank of America, which fell 2% after its result was hit by write downs on home loans. Elsewhere, regional banks continued their recent run while giants JP Morgan, Citigroup and Wells Fargo all managed gains of more than 1.2%.

Among industrials, giant conglomerate GE gave a shot to investor confidence, jumping more than 7% to fresh 52 week highs after it reported better-than-expected earnings of 36 cents per share on revenues of $41.1 billion. The company is always seen as a good barometer of the broader economy.

Elsewhere, we could see some gains among energy stocks after a solid session on Wall Street, although local names will have to shrug off a slightly negative lead on Crude Oil prices. Oil fell 0.4% and is trading at US$89.11 per barrel. The likes of ExxonMobil, ConocoPhillips & Chevron were all up more than 0.7%.

Probably the biggest headwind to the local market will be the materials sector, which slipped a modest 0.3% in US trade. Leads from the UK were actually fairly supportive with most base metals higher on the London Metals Exchange and Rio Tinto and BHP Billiton rising 0.1% and 0.5% respectively in London trade. Nonetheless, BHP Billiton’s ADR is calling the locally listed entity 0.3% weaker at $44.56 on the open.

In summary, it looks like we’re set to start the week with modest gains following the offshore leads. In terms of economic news, the producer price index is due for release at 11.30am, but is expected to have little impact on trade unless it is much hotter-than-expected. Tomorrow’s CPI read is likely to be the key.

In currency markets, the euro continued its bullish run, helped by broad-based US dollar weakness. It is trading at eight-week highs of 1.3613. Elsewhere, the AUDUSD recovered some of its recent falls; its trading at 0.9896, just below the 99c barrier.

Market Price at 8:00am AEST Change Since Australian Market Close Percentage Change
AUD/USD 0.9895 0.0031 0.32%
ASX (cash) 4766 10 0.21%
US DOW (cash) 11872 64 0.54%
US S&P (cash) 1284.0 6 0.49%
UK FTSE (cash) 5891 15 0.25%
German DAX (cash) 7070 31 0.44%
Japan 225 (cash) 10301 19 0.18%
Rio Tinto Plc (London) 42.43 0.06 0.14%
BHP Billiton Plc (London) 23.93 0.11 0.46%
BHP Billiton Ltd. ADR (US) (AUD) 44.56 -0.15 -0.33%
US Light Crude Oil (Mar) 89.11 -0.32 -0.36%
Gold (spot) 1342.7 -3.38 -0.25%
Aluminium (London) 2419.00 11 0.46%
Copper (London) 9455.00 76 0.81%
Nickel (London) 26250.00 561 2.18%
Zinc (London) 2320.00 -22 -0.94%
RBA Cash Rate to be raised by 25bp (Feb) (%) 5.00 2.0 2.00%

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