(WS) Final World Summary: STOCKS FLAT DESPITE COMMODITY SURGE RWE News 8:35:020 17/06/2005 Sydney - Friday - June 17: (RWE Australian Business News) - US equities have had another indecisive day with movements of key indices showing few signs of any real action. A surge in the oil price kept buyers at bay while the economic data has been mixed. Wall Street's Dow Jones hovered around zero for part of the session and only came to life in the last half hour of business, settling 12 points in front. The S&P 500 crept up 4 while the Nasdaq rose 14 and the 100 index 8 points. Commodity producers like Alcoa Inc and Exxon Mobil Corp caught most of the buying support. Outlook for energy costs clearly worried financial markets after OPEC disclosed fourth-quarter demand will average 85.91 million barrels a day. Members of the Organisation of Petroleum Exporting Countries have to pump 30.6 million barrels a day in the quarter, 100,000 barrels more than forecast last month. OPEC, which raised output quotas yesterday, pumped 29.9 million barrels a day in May. July crude finished $1.01 higher at $56.58 barrel on the New York Mercantile Exchange. It is still below the peak price of $58.28 set on April 4, although the August contract reached a high of $57.60. OPEC's president, Sheikh Ahmad Fahd al-Sabah of Kuwait, can call for a second increase of the same size after consultations with fellow ministers. This would begin after the group's price index exceeded $50 a barrel for seven days, he said yesterday. Meanwhile, economic data has been mixed. The Philadelphia Federal Reserve Bank's June regional economic survey showed a contraction for the first time in over two years. The index came in at minus 2.2, well below May's positive 7.3 reading. Analysts had tipped a June reading of 10.0. But the survey of factories in the highly industrialised mid-Atlantic region in and around Philadelphia also showed that optimism about the six-month outlook was higher than last month, softening the report's effect on the bond market. Kansas City Federal Reserve Bank President Thomas Hoenig said a neutral federal funds rate probably lay between 3.5 per cent and 4.5 per cent, and the Fed wanted to reach that neutral range "sooner rather than later". In other data, housing starts rose 0.2 per cent last month to the fastest rate since February. The Commerce Department reported an annual rate of 2.009 million housing units. Fannie Mae, America's biggest mortgage provider, said US home sales could strike a fifth consecutive record in 2005 due to low mortgage rates. On the labour front, the number of Americans seeking first-time unemployment benefits claims rose 1000 to 333,000 in the week ended June 11. The closely watched four-week moving average also rose, climbing 2750 to 335,000, according to the Labor Department. Commodity prices boomed overnight with a number of metals close to or posting record highs. Copper reached its best price ever of $3323 tonne while gold surged to mid-April highs after gaining $7.10 to $436.10 oz. The US dollar has been mixed as the euro languishes. The Aussie dollar climbed more than half a cent to US77.23c. Treasuries improved on some of the weaker data, reflected by the 10-year cash paper yield falling 3.5 points to 4.075 per cent.
WALL STREET ... settled 12.28 points higher at 10,578 on the Dow Jones Industrial Average. The broadly based S&P 500 finished 4.35 ahead at 1210.93. The Nasdaq composite rose 14.23 to 2089.15 and the 100 index 7.93 to 1537.42. Treasuries broke the downturn. Ten-year cash paper rose 9/32 to 100 13/32, trimming the yield 3.5 points to 4.075 per cent.
US DOLLAR ... has been mixed against major currencies. The greenback is selling at 108.93 yen, down from 109.28 at the previous close in NY. The Euro is at 1.2100 (prev 1.2119) and sterling is 1.8228 (prev 1.8229). The US dollar bought 1.2723 Swiss francs (prev 1.2705).
AUSTRALIAN DOLLAR ... has strengthened against the greenback. It is now changing hands at US77.23c, up 55 points on last night's local close. High for the session was 77.43c and low US76.59c in NY overnight. Crosses have been firmer. The Aussie bought 84.12 yen (prev 84.12), 0.6381 euros (prev 0.6352) and 42.37 pence on sterling (prev 42.23).
AUSTRALIAN SHAREMARKET ... may well end the week on a strong note, thanks to the surge in commodity prices, which saw mining leaders rise sharply in London overnight. The All Ordinaries closed up 17.5 points to 4221.3 yesterday while the ASX 200 hit a record 4284.7 before settling 16.3 in front at 4262.8. Futures edged higher overnight with September and December contracts adding 3 points apiece to 4279 and 4294 respectively. Today's data is May merchandise imports from the Australian Bureau of Statistics. Oil explorer Elk Petroleum will see its 20c shares trade for the first time at 11am.
EUROPEAN SHAREMARKETS ... closed flat to moderately higher. In London, the mining sector was strong, buoyed by good Chinese industrial data and a recent hike in base metals and energy prices. BHP Billiton shares jumped 4.22 per cent to 716.0p, Rio Tinto 3.87 per cent to 17.45 pounds and Chilean copper miner Antofagasta 3.64 per cent to 12.25 pounds. Xstrata put on 2.7 per cent to 10.64 pounds and Anglo American 2.59 per cent to 13.45 pounds. Anglo-Dutch steel producer Corus was boosted by the performance of its French and German counterparts and climbed 5.33 per cent to 44.50p. In other news, cruise operator Carnival saw its shares surge 5.03 per cent to 31.09 pounds after an optimistic outlook statement together with good second-quarter figures. On the Continent, the world's largest steel producer, Arcelor, saw its shares gain 3.44 per cent to 16.55 euros in Paris and German counterpart ThyssenKrupp added 1.56 per cent to 14.99 euros. In technology news, Philips Electronics rose 1.08 per cent to 21.55 euros after rebounding from Wednesday's losses following its profit warning. According to the Wall Street Journal, Philips has completed drafting terms with Hong Kong-based TPV Technology in an arrangement to sell and transfer part of Philips's monitor and flat-screen television business to TPV. In Paris, computer services group Capgemini dipped 0.71 per cent to 26.60 euros after announcing a 380 million euro convertible bond to improve the IT company's financial flexibility. French company EADS gained 1.59 per cent to 23.67 euros after Airbus, the European aircraft maker it jointly owns with BAE Systems, announced 100 firm orders for its A320 planes after this week's Paris Air Show. At the close, London's FTSE 100 rose 25.50 to 5045.00, Paris's CAC-40 edged up 0.79 to 4185.15 and Frankfurt's DAX advanced 31.45 to 4579.87. In other markets, Amsterdam rose 3 and Madrid 61.
METALS ... bounded ahead, with a number registering record highs. On the LME copper posted the highest price within memory. Gold turned in the best performance since mid-April with the COMEX spot month price climbing $7.10 to $436.10 oz. The August contract rose $7 to $437.90 oz. July silver gained 4c to $7.37 while July platinum reached the top end of peak levels with a jump of $9.10 to $891.50 oz. New York July copper put on 2.05c to 156.95c lb. Closing three-month London Metal prices were copper $3323 tonne, tin $7540, lead $965 zinc $1304, aluminium $1745 and nickel $16,075 tonne. Three-month official bid prices on the London Metals Exchange were stronger. Copper advanced $33 to $3317 tonne but tin dipped $45 to $7600 while lead added $4 to $971. Zinc gained $39 to $1298. Aluminium improved $19.50 to $1745 and nickel sold $125 higher at $16,145 tonne.
OIL ... settled $1.01 higher at $56.58 barrel. High for the session on the New York Mercantile Exchange was $56.90 and low $55.40. Dealers lifted the August contract $1.02 to $57.43 barrel, with a high of $57.60 and low of $56.40. Serious concern has emerged over supplies for the fourth quarter and whether OPEC can meet the demand. The Energy Department reported this week that stockpiles fell 1.8 million barrels to 329 million in the week ended June 10. But OPEC has confirmed it will lift production another 500,000 barrels a day from July 1 at its meeting in Vienna this week. In London, August Brent crude advanced 98c to $56.20 barrel on the International Petroleum Exchange.
The CRB index finished 1.61 points higher at 308.59. ENDS !END
