* U.S. stock markets held on to their recent gains after they resumed their bullish trends hitting new record highs, in a busy week for US economic data, where the US markets will be closed on Friday for the 4th July holiday.
* European stock markets continued higher after rebounding the most in two months, ahead of the ECB meeting.
* Asian stock markets rose again yesterday and are trading as their highest level since June 2008, on the back of consistent manufacturing data.
* Commodities prices built on recent gains, Gold prices rose to $US1,330, while crude-oil eased below $US105. Copper jumped to US3.26c and Iron Ore prices eased below $US95.00.
The Australian sharemarket has surged over 1.5% yesterday, with the ASX200 up at 5455. The gains were driven by the large caps, which generally recoup the losses of the past couple of sessions. Trading volumes were down though. By late afternoon, the Big-4 banks accounted for 24 points of the move, Wesfarmers and Woolies contibuted 9 points and BHP added nearly 10 points to the index on its own. The best performing sector was Consumer Staples, up 2.5%, while the Financials and Industrials sectors gained 1.5% and the major miners pushed the materials index up 1.8% for the session.
There is still plenty of economic news due out across the globe tonight, with manufacturing data in Europe, China and the US. The US markets will be closed on Friday for the 4th July holiday. The RBA governor Stevens speaks today and Retail Sales and Building Approvals are also due out today.
The SPI 200 futures are up 0.4% at 5432, giving another positive lead for the ASX market today, following a spectacular session. The Australian dollar last traded at US94.4c, after hitting its highest level since November. The 5470 level is key near-term for the ASX200, as the markets across Europe and the US edged higher overnight.
Copper prices have been on a steady rise since the March low.
US Markets
U.S. stock markets held on to their recent gains after they resumed their bullish trends hitting new record highs, in a busy week for US economic data, where the US markets will be closed on Friday for the 4th July holiday.
The three benchmark indexes all closed flat for the session, as the Russell Small Cap index eased -0.5% after hitting a new record high, while the Dow Transport Index is also trading at all time highs.
Six of the ten S&P500 sectors finished in the green, as gains were led by the Healthcare sector up 0.8%, the Telecoms and Consumer Staples sectors rose over 0.3%, while falls came from the Energy and Industrials sectors down -0.2%. Airlines slumped over -3.6% after Delta warned on revenues. The S&P500 continue to trade within a 1% range as it has done for the past 53 sessions, the longest such stretch since 1995. The CBOE VIX eased to 10.8 trading its lowest level since 2007.
In economic news the ADP jobs report showed 281,000 were added to US payrolls in June, the most since November 2012, setting up for a good NFP monthly payrolls report due out tonight. Factory orders fell -0.5% in May (down from a 0.8% gain in April).
For the session Dow Jones closed up 0.1% at 16,979, the S&P500 closed up 0.1% at 1,974 and the NASDAQ closed flat at 4,457, while on 10-year Treasury notes jumped to 2.63%.
European Markets
European stock markets continued higher after rebounding the most in two months, ahead of the ECB meeting.
The Stoxx Europe 600 Index finished up another 0.2% for the session, as traders stepped back into equities as eurozone manufacturing expanded. Trading volumes were nearly 20% above the monthly average. The index had traded lower in in June, as violence in Iraq escalates and disappointing economic data. For the quarter the index closed up 2.3%, for it fourth straight quarterly gains, its longest string of gains since 2010. The index is still trading around its highest level since January 2008.
Across the region the miners and financials supported the markets, after miners recorded their best rally since mid-May in the previous session, when Rio Tinto and BHP rose 3%.
The London market rebounded for a second session, recovering for its best two session gain since April, after it rose 2.2% for the quarter, trading near 14 year highs. UK equities valuations finished June at their highest levels since 2009. The German market finished flat, as manufacturing data for the eurozone is holding above the expansion reading, although at a slower pace last month at 51.8 (down from 52.5).
The ECB is expected to leave rates on hold tonight, after introducing negative deposit rates and new asset buying programs last month.
For the session the German DAX 30 closed up 0.1% at 9,911, the UK the FTSE 100 closed up 0.2% at 6,816, the French CAC 40 closed down -0.4% at 4,444, while the Spanish market closed up 0.1% at 11,016.
Asian Markets
Asian stock markets rose again yesterday and are trading as their highest level since June 2008, on the back of consistent manufacturing data.
The MSCI Asia Pacific Index rose another 1.0% for the session, after posting its biggest quarterly gain since September, having risen for seven straight weeks of gains. Across the region gains were led by tech and casino stocks. The index is up 12% from its February lows.
The Chinese market edged up from near the lows for the year, as PMI figures showed Chinese manufacturing expanded in June, at the fastest pace this year, as the central bank has cut the amount of reserve funds required by the banks in a move designed to increase to their lending capacity. The Hong Kong market surged, after playing catchup with trading volumes over 35% above the monthly average and index is up nearly 12% from its March lows.
In Japan the market held around five month highs, after rising over 2% in the past couple of sessions. In economic news Japan reported industrial production expanded 0.5% in May (compared to April were it shrank -2.8%) and is forecast to expand 0.7% and 1.5% in the next two months, thanks to the new government polices on encouraging business growth.
For the session the Shenzhen Composite closed up 0.3% at 2,170, the Hong Kong Hang Seng closed up 1.6% at 23,549, and the Japanese Nikkei closed up 0.3% at 15,369, while the South Korean KOSPI closed up 0.8% at 2,015.
Commodities
The Dollar Index edged higher to 79.94 on a lower Euro, and the Aussie Dollar eased to US94.4c, after hitting its highest level since November. Commodities prices edged higher.
Overnight the COMEX WTI Crude for JUL14 delivery eased to $US104.80, the COMEX Copper for JUL14 delivery closed jumped 2% to 3.26, the COMEX Gold for JUL14 delivery closed rose 0.4% at $US1,330.90.
ASX News
ALZ – A Singapore property group appears set to grab local residential and commercial developer Australand in a $2.6 billion deal.
GFF – Goodman Fielder the struggling food maker is likely to accept a lower takeover offer from Hong Kong-based investment firm First Pacific and Singapore agribusiness Wilmar
International.
JBH – Blackrock Group have announced a substantial stake in JB-HiFi today.
LYC – Lynas the rare earths miner, is moving its Sydney headquarters to Kuala Lumpur as part of changes to reduce its costs.
TAH/TTS – Gambling firms Tabcorp and Tatts will have to pay millions of dollars in poker machine levies to the Victorian government after a Supreme Court ruling was overturned.
TWE – Treasury Wines the maker of Penfolds is being hauled before the Federal Court by hundreds of shareholders angry at how the company revealed major problems in its US business in 2013.
VOC – Vocus Communications, has agreed to buy FX Networks for $A107.8 million including debt, gaining a New Zealand fibre optic cable network operator it says will add to earnings in its first year.
WOW – Grocery prices at Woolworths supermarkets have been creeping higher despite steady supplier costs. Deutsche Bank has upgraded Woolworths and Wesfarmers on these pricing trends. Analysis suggests that the trend has continued to improve over the June quarter with inflation in both fresh and long life produce.
WES – Wesfarmers is facing a $774 million hit to its bottom line from its struggling Target chain and the restructure of its liquor business.
Market Summary
ASX – to open higher
US & UK/Europe – higher
US ADRs – Broadly higher!!…
ANZ 0.4%, NAB 1.9%, NWS 0.7%
AWC 3.4%, BHP 1.4%, RIO 1.9%, NEM 1.1%
By Michael Hevern D2MX Investment Advisor For trade ideas and recommendations on how to trade in this market, sign up for a free trial of the D2MX Daily Trading Report, call 1300 610 024 or email advisory@d2mx.com.au.