Australian shares will look to start the session modestly higher after improved US retail sales and jobs data steered Wall Street to a fourth positive close.
The June SPI 200 futures contract ended the night session 11 points or 0.2% stronger at 5022 as US share indexes logged record closes and key metals rebounded.
The S&P 500 hit an intraday record high of 1,597 before closing five points or 0.33% ahead at 1,593. The Dow advanced 63 points or 0.42% to 14,865, also a record close, while the Nasdaq trailled at +0.08% after the worst PC shipping figures in 19 years sparked sharp falls in Microsoft, Intel and Hewlett-Packard.
Recent nerves over the US jobs market were steadied by a big drop in first-time claims for weekly jobless benefits. Claims declined by 42,000 to 346,000 last week, more than economists had predicted following a run of volatile readings due to the Easter break. The decline brought the measure back to the levels that have prevailed for most of this year.
"This data is especially welcome on the heels of last week's jobs report, and it just adds to the tremendous demand that there continues to be for equities," the chief investment officer at BNY Mellon Wealth Management in the US told Reuters. "The money that has been waiting for a pullback is running out of patience."
The telecoms and consumer discretionary sectors were the stand-outs as cyclical stocks took a back-seat. An index of US retailers hit record levels after leading outlets reported solid March sales and raised their outlooks for this month. PC and computer-chip makers were hammered after a report showed shipments of PCs sagged 14% over the first quarter of the year as the trend towards smart-phones and tablets accelerated.
Copper caught an up-draught from the US jobs news, while other base metals were mixed. US copper for May delivery was recently up a cent or 0.3% at US$3.43 a pound. In London, copper rallied 0.5%, nickel 1.4% and zinc 0.2%. Aluminium dipped 0.6%, lead 0.2% and tin 0.1%.
A softening US dollar helped gold stabilise following Wednesday's dive, the metal's worst intraday fall since November. Gold for June delivery was lately up $2 or 0.1% at US$1,560.80 an ounce. Silver for May delivery was down eight cents or 0.3% at US$27.57 an ounce.
Oil suffered its first fall in four sessions after the International Energy Agency lowered its growth forecast. The IEA said it now expected global demand growth of 795,000 barrels a day, reduced from a previous forecast of 820,000 barrels a day. West Texas intermediate crude for May delivery was recently down $1.15 or 1.2% at US$93.49 a barrel.
European markets rallied for a fourth night after a successful Italian bond auction continued the recent trend towards lower government borrowing costs. Germany's DAX gained 0.79%, France's CAC 0.86%, Britain's FTSE 0.45% and Italy's FTSE MIB 0.58%.
TRADING THEMES TODAY
INCHING HIGHER: Barring surprises, the Australian market's best week in more than a month looks likely to end on a positive note. Last night's US rally wasn't especially inspiring, but it continued this year's trend towards slow but steady improvement. The most impressive detail was that the Dow led the indexes despite hefty falls in Microsoft, Intel and HP. These were offset by record highs in several other Dow blue chips. Biotechs had a good night, while gold/silver miners lost ground. Our goldies took the hit yesterday and may see some recovery today.
ECONOMIC NEWS: No significant domestic news scheduled today. A busy night ahead in Europe includes monthly industrial production data and European Council and Eurogroup meetings. A light week in the US ends with a bang: earnings from Wells Fargo and JPMorgan, retail sales/core retail sales, producer price index/core PPI, preliminary consumer sentiment and inflation expectations, business inventories and a speech by Fed Chairman Ben Bernanke.
