Bull shift pushes market higher
September 14th, 2010 by Bryden Elssmann
Closing Data
| Current | Change | % | |
|---|---|---|---|
| Dow Jones | 10,544.13 | 81.36 | 0.8% |
| NASDAQ | 2,285.71 | 43.23 | 1.9% |
| S P 500 | 1,121.90 | 12.35 | 1.1% |
| FTSE 100 | 5,565.53 | 63.89 | 1.2% |
| Nikkei 225 | 9,321.82 | 82.65 | 0.9% |
| ASX 200 | 4,622.70 | 7.8 | 0.2% |
| COMEX Gold - Dec 09 | 1247.1 | 0.6 | 0.0% |
| COMEX Silver - Sep 09 | 20.1 | 0.255 | 1.3% |
| COMEX Copper - Sep 09 | 347.9 | 7.25 | 2.1% |
| WTI Spot | 77.19 | 0.74 | 1.0% |
| AUD-USD | 0.936 | 0.0061 | 0.7% |
| Aluminium | 2,108.00 | 24.5 | 1.2% |
| Copper | 7,630.00 | 105 | 1.4% |
| Lead | 2,186.00 | 16 | 0.7% |
| Nickel | 23,080.00 | 255 | 1.1% |
| Tin | 22,050.00 | 250 | 1.1% |
| Zinc | 2,147.00 | 17 | 0.8% |
US stocks rallied overnight carrying all three major Wall Street indexes into positive territory, with global banks being given as much as eight years to meet new capital-reserve requirements. Saturdays positive economic data out of China has been well received by global markets. The data confirmed the world’s second biggest economy is continuing to expand. This is particularly important for the Australian market because investors were, previously, concerned that the Peoples Bank of China (PBOC) would raise interest rates potentially sapping optimism out of the markets, sparking a selloff in the resource sector. However the data was strong and, for now, there will be no PBOC rate hike. BHP is expected to press higher today. Today may be a good day to write calls for October.
The Aussie dollar continues to climb higher with it potentially reaching as high as US96c by the end of the month with many investors predicting parity with the US dollar within the next 12 months. The $A has been propelled higher by Chinese data and speculation the RBA is likely to raise rates this side of Christmas; $US0.936. However the Aussie dollar is performing best against the Euro, up 16.2% for the year hitting a high of €0.733.
Everyone is saying September is going to be the worst month, however a wave of positive macro economic data may disprove the bears amongst us; Chinese GPD data and stronger than expected domestic growth figures have caused a bullish shift on the local bourse pushing the ASX 200 above 4600 points yesterday, a key level on our index. The market has been trading in a narrow range between 4200 and 4600 points since May, struggling to push above 4600 points. The market is now trading on a 4 month high with mining stocks and the financials pushing the market higher as investors shift out of defensives.
For now all eyes will be on the Aussie dollar, which is a reliable indicator of our equity market, a breakthrough above $US0.94 could propel the share market toward a new trading range of between 4600 – 5000 points.
Contact your Freeman Fox Stockbroker on 07 3031 9960 or 1800 003 369 Ext 7.
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