daytrade diaries... october 20

Morning traders.

Market wrap: Stocks look set to bounce hard today after a boom night on resources markets and healthy gains for overseas equities.

European and north American markets pushed to new 2009 highs as oil, gold and base metals advanced. In a bullish sign in the U.S., investors snapped up companies that are due to report third-quarter earnings this week, suggesting renewed optimism about the outlook after Friday's market wobble.

The Dow Jones Industrial Average rallied 0.96% to a 2009 closing high of 10,092. The S&P 500 gained 0.94% and the Nasdaq rose 0.91% ahead of Apple's earnings result, due just after the closing bell. Traders ignored a report showing sagging confidence among U.S. home builders.

Resources-focused US stocks prospered. Oilers rose around 1.1%, gold/silver miners climbed 0.86% and natural gas companies 1.34%. The financial sector was a notable laggard, finishing red. REITs gained 1.99%, industrials 1.29% and insurers 1.24%.

European markets fared even better. Britain's FTSE climbed 1.76%, Germany's DAX 1.9% and France's CAC 1.69%.

Resources benefitted from another grim night for the US dollar. Crude oil futures touched a one-year high of $79.69 before recently pulling back to $79.29, a rise of around 1.4%. Crude has now rallied 13% in eight sessions. Gold's safe-haven appeal saw it gain 0.7% overnight, back towards last week's high. The spot price was recently trading at $1062.50.

Copper pushed to its highest level in more than a month, spearheading a night of big gains for base metals. Analysts say talk during London Metals Exchange Week that consumers may have used up their copper stocks had helped sentiment in the industrial metals market. In London, copper rose 3.89%, aluminium 2.62%, lead 3.77%, nickel 3.04%, tin 1.03% and zinc 3.26%.

Futures traders expect our market to wipe out two days of losses at today's open. The SPI futures index was 43 points higher at 4852.

TRADING THEMES TODAY

RESOURCES: Oil and gold have already broken out. Base metals now look like they might follow. They key to all is the dire state of the US dollar, which shows no signs yet of halting its precipitous decline. Oil looks increasingly likely to hit $80 before this week is out.

WILDCARD: Apple was due to release its third-quarter earnings after the closing bell in the US. The result will sway US futures and provide a pointer to tonight's market direction. The share price advanced ahead of the result.

ECONOMIC NEWS: The Reserve Bank releases the minutes from its last policy meeting at 11.30 am today. Investors will analyse the minutes for clues to the pace of interest rate rises this year. Also due at 11.30: last month's merchandise import figures. The main focus in the US will continue to be Q3 earnings reports but also due tonight are housing starts, building permits, producer price index data and another consumer confidence report.

Good luck to all.