Local stocks are poised to open higher on the promise of lower for longer US interest rates.
What you need2know:
• SPI futures up 16 points to 5423 at 6.10am AEST.
• AUD at 93.72 US cents, 95.81 Japanese yen, 67.83 Euro cents and 55.79 British pence at 6.10am AEST.
• On Wall St, S&P500 +1.1%, Dow Jones +1%, Nasdaq +1.3%
• In Europe, Euro Stoxx 50 +1.5%, FTSE100 +0.7%, CAC +1.4%, DAX +1.6%
• Spot gold flat at $US1302.48 an ounce
• Brent oil up 0.2% to $US109.62 per barrel
• Iron Ore slips 0.8% to $US116.20 per metric tonne.
• LME three-month copper sinks 1.9% to $US6541 a tonne
What’s on today
Australia: motor vehicle sales, labour force detailed, NAB Business survey, ABS international merchandise imports
US: Philadelphia Federal Reserve survey
Stocks to watch
Diversified financials, the highest-flying group of stocks on the ASX in the last year and a half, were among the hardest hit in the past week, strengthening the case for investors looking to buy into the high growth segment.
RBC Capital Markets has an “outperform” recommendation on Rio Tinto after it released its first quarter 2014 results report.
Morningstar has a “hold” recommendation on Westfield Retail Trust after narrow-moat rated Westfield Group (Westfield) and Westfield Retail Trust released details of their proposed restructure.
Currencies
The euro rose 0.07 percent to $US1.3822. There were also more bond gains for former trouble spots Italy, Spain, Portugal and Greece.
Nomura reports that total foreign exchange intervention by the People’s Bank of China fell to $US108 billion of foreign currency buying in first quarter from $135 billion in fourth quarter 2013, according to our proprietary estimates derived from the headline reserve figures. T
The 12-month moving average of FX intervention remains near the high end of the historical range at $US33 billion against a $US40 billion peak in August 2011.
Commodities
Copper is higher, recouping some of the last session’s deep losses, on relief that top consumer China posted slightly higher-than-forecast first-quarter growth.
Nickel has rallied to its highest in 14 months, supported by escalating tensions between the West and Russia over the crisis in Ukraine. Russia is the world’s second-largest producer of refined nickel, and any sanctions would likely affect exports.
Metallurgical coal prices were generally higher this week with premium low-vol prices up 0.9 per cent and semi-soft prices up 2.4 per cent, while low-vol HCC prices were down 0.8 per cent, reports RBC Capital Markets.
United States
Fed chair Janet Yellen, reinforcing her dovish policy credentials, said the continuing lacklustre performance of the US jobs market will keep the central bank accommodative “for some time” to come.
Separately, in its Beige Book report of anecdotal information on business activity collected from contacts nationwide, the US central bank said eight of its 12 districts characterised growth as "modest to moderate".
Google's internet unit revenue grew 19pc in the first quarter, falling short of Wall Street targets as the price of its online ads continued to decline.
Bank of America, the second-biggest US lender, has swung to an unexpected first-quarter loss as the company booked $US6 billion of costs tied to the cleaning up of mortgage disputes.
Europe
European shares rose on Wednesday, reversing the previous session's slide after economic growth data from China came in a touch above forecasts.
France’s prime minister vowed the country would honour its European commitments on deficit reduction and rushed out details of a plan to curb spending by €50 billion between 2015 and 2017.
National Bank of Greece was set to be the fourth Greek lender to tap international markets through a share offering after plans were approved for it to raise up to €2.5 billion to boost its core capital.
What happened yesterday
Local shares moved higher as Australia’s biggest trading partner China beat expectations to narrowly avoid posting its slowest rate of economic growth in five years and resources giant BHP Billiton told shareholders it plans to boost iron ore production this year.
The benchmark S&P/ASX 200 Index rose 32.1 points, or 0.6 per cent, on Wednesday to 5420.3, while the broader All Ordinaries Index also added 0.6 per cent to 5412.6.
