daytrading aug 7 pre-market

Morning traders.

Market wrap:

Shares have a modestly positive platform for the day after equities and most commodities were lifted by German support for European Central Bank bond-buying and progress in Greek debt plans.

The September SPI 200 futures contract ended the night session 12 points or 0.3% ahead at 4242 despite a late sell-off on Wall Street that sharply trimmed the night's advance.

The Dow was up nearly 90 points for much of the night but closed just 21 points or 0.16% ahead as the major indexes wilted in the final hour. The S&P 500 put on 0.23% and the Nasdaq outperformed at +0.74%.

With little US news overnight, the focus remained on Europe where developments continued to support Friday's optimistic turn. Spanish and Italian bond yields retreated further from danger levels after a spokesman for German Chancellor Angela Merkel said her coalition government supported the ECB's plan to resume buying sovereign debt. German opposition to ECB bond-buying had been seen as a major obstacle to the plan.

A visit to Greece by inspectors from the International Monetary Fund, European Commission and the ECB concluded on a hopeful note. The "troika" said Greece had made progress towards the budget targets needed to access more bailout funds but further cuts were needed.

European stocks closed at four-month highs with banks carrying Spanish and Italian debt leading the rally. Germany's DAX added 0.77%, France's CAC 0.81%, Britain's FTSE 0.37%, Spain's IBEX 35 4.41% and Italy's FTSE MIB 1.54%.

"Investors are less pessimistic about the euro-zone situation," a senior currency strategist at Barclays Capital in the US told Reuters. "There is the expectation that something positive will come out of the ECB plan and so investors are more willing to search for risky assets that look attractive."

Oil ignored the late sell-down in US equities, hovering near a two-week high. West Texas crude for September delivery was recently up 69 cents or 0.8% at US$92.09 a barrel.

Gold clawed out a second positive session to reach a one-week peak as Friday's US jobs news continued to pressure the US dollar. Gold for December delivery was lately ahead $5.30 or 0.3% at US$1,614.60 an ounce.

Strategists at Credit Suisse told MarketWatch the dollar "tends to depreciate after good economic data due to reduced safe-haven flows. That is positive for gold."

Most base metals advanced but trade remained subdued amid the northern hemisphere summer holiday season. In London, copper advanced 0.7%, aluminium 1%, nickel 1.1% and zinc 0.5%. Lead lost 0.3% and tin 0.4%. US copper for September delivery was recently up one cent or 0.4% at US$3.38 a pound.

TRADING THEMES TODAY

CAUTIOUS OPTIMISM: A mostly positive set of leads for the day ahead but that late sell-down in the US gives some cause for concern. I can't find any specific reason on the news wires, so it may be simple profit-taking as the major US indexes reach technical resistance after a strong run. Nonetheless, this rally has good momentum and further gains seem highly likely here over the weeks ahead unless there is a major change of sentiment. This afternoon brings an RBA rate decision that is unlikely to be market-moving - a substantial majority of economists predict there will be no change. Small caps outperformed in the US overnight. Other stand-out sectors included precious metal miners, tech stocks and telecoms.

ECONOMIC NEWS: AIG's Construction Index is due at 9.30am EST. The afternoon brings the Reserve Bank cash rate and statement at 2.30pm. Europe has some manufacturing, GDP an industrial production data. A light week in the US continues a speech by Federal Reserve Chairman Ben Bernanke and consumer credit figures.

Good luck to all.