Mar 17, 2015

need2know: Global rally to boost ASX

Local shares are poised to open higher as global equities surge higher, bolstered by easy money policies.
What you need2know:
• SPI futures up 44pts at 5840
• AUD at 76.42 US cents, 92.80 Japanese yen, 72.22 Euro cents and 51.52 British pence  
• On Wall St, S&P 500 +1.3%, Dow +1.2%, Nasdaq +1.1%
• In Europe, Stoxx 50 +1.4%, FTSE +1%, CAC +1%, DAX +2.2%
• Spot gold down $US4.30 or 0.4% to $US1154.18 an ounce
• Brent oil down $US1.23 or 2.3% to $US53.44 per barrel
• Iron ore adds 2.2% to $US58.90 per tonne 
What's on today
Australia Reserve Bank of Australia Board minutes, weekly consumer confidence; US housing starts, building permits:elections in Israel; Bank of Japan policy decision; German ZEW survey; Euro zone CPI; Turkish rate decision. Results from Oracle, Adobe and Porsche.
Stocks to watch
The following shares will trade ex-dividend today: Auckland International Airport, Burson Group, Equity Trustees, Vita Life Sciences.
Morningstar has a "hold" on iiNet Ltd and a fair value of $8 a share.
Deutsche Bank says it is "cautious" but retains a "hold" on valuation grounds with a $1.60 price target.
Currencies
The US dollar has fallen across the board, as investors fret that the greenback's rapid rise could prompt the Federal Reserve to be a little more cautious about raising interest rates this year.
The euro gained 1.1 per cent against the greenback to $US1.0605 in morning trade in New York. Analysts said another push higher for the US currency was unlikely ahead of the conclusion of the Fed policy meeting in Washington on Wednesday.
Switzerland's finance minister said on Monday the government may try to meet more often with the Swiss National Bank but that it had not asked the SNB to introduce a new cap on the Swiss franc.
Commodities
Oil prices fell 2 per cent, with US crude hitting six-year lows, on signs of higher output in the United States and Libya and a possible nuclear deal that could end sanctions for Iran, allowing more of its oil into the market.
A market data provider estimated a fresh build of more than 3 million barrels at the Cushing, Oklahoma delivery point for US crude futures last week, traders said, adding to worries that stockpiles in the United States could hit record highs for a tenth straight week.
Gold is trading just above its lowest level in more than three months. Spot platinum continued its fall, reaching the lowest since July 2009.
United States
US stocks are higher, with utilities leading a rebound on the S&P after three weeks of losses. The S&P utilities index, which tends to do well in a low interest rate environment, was up 2.1 per cent, leading the day's gains.
Factory production slipped 0.2 per cent last month after declining 0.3 percent in January, the Fed said on Monday. The report joined dour retail sales, construction and housing starts data, which recently prompted economists to slash their first-quarter GDP growth estimates.
Procter & Gamble is exploring a sale or initial public offering of some of its beauty brands in a single deal, Bloomberg reported.
Europe
Germany's DAX raced to record highs on Monday, part of an extended European stock market rally.
"The unrelenting rally in European shares continues, helped by the weak euro and improving economic data. There is no reason right now to lighten up and I continue to be a buyer," said Hampstead Capital hedge fund manager Lex Van Dam.
The Greek stock market underperformed, declining 0.9 per cent due to lingering concerns over how the country would tackle its debt agreements.
What happened yesterday
A worsening outlook for key commodity prices weighed on mining and energy stocks, driving local shares lower on Monday. The S&P/ASX 200 Index fell 17 points, or 0.3pc, to 5797.7.

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