daytrade diaries... january 14

Morning traders.

Market wrap: The Australian stock market is primed to rebound this morning after a broad rally on Wall Street.

Futures traders expect our market to recover most of yesterday's losses at today's opening bell. The SPI futures index closed 26 points higher at 4878 after solid gains in the U.S. and advances for key commodities as the U.S. dollar weakened.

Wall Street advanced after gains in the health sector and a bounce in financial stocks as the CEOs of the big banks testified before a federal commission in Washington. The S&P 500 gained 0.83%, the Dow 0.5% and the Nasdaq 1.12%.

Health stocks surged after an analyst upgrade for Merck, while the financial sector survived a congressional grilling of key players in the global financial crisis. Also helping sentiment, the Federal Reserve's beige book of regional economic indicators pointed to a modest improvement in the U.S. economy.

The S&P Bank Index advanced 1.7%. Also strong were airlines +2.95% and REITs +2%. Resource stocks also made gains.

A sliding U.S. dollar helped base metals recover some of yesterday's losses. Copper bounced off a two-week low as traders bet that Chinese moves to dampen its economy confirmed the Asian giant's robust growth prospects. "It means that their economy is doing really, really well - maybe even better than they've expected," said an analyst quoted on Reuters. "Chinese imports are on the rise. It's very impressive that they're still buying." In London, copper gained 0.54%, aluminium 0.61%, lead 1.36%, nickel 2.54% and zinc 0.77%.

The spot gold price shook off an early dip under $1,120 an ounce and advanced nearly $10 to trade recently at $1,137.50. However, crude oil fell for a third straight session after U.S. stockpiles rose more than expected. Crude futures were trading recently at $79.65 a barrel, down 1.41%.

European markets were mixed. Britains FTSE lost 0.46% after falls in the major oil companies but Germanys DAX added 0.34% and Frances CAC was near flat at +0.02%.

TRADING THEMES TODAY

INTEL REPORT: The tech giant is due to release its fourth-quarter result after this morning's closing bell. The result carries particular significance because I.T. was the best-performing sector in the U.S. last year and Intel is the first of the big four bellwether tech stocks to report. U.S. futures will indicate how the result has been received. The chip-maker was up around 1.9% in today's trade ahead of the result.

CHINA: A possible fly in the ointment today. The major Chinese share index slumped 3.1% yesterday after the central bank tightened lending policies, sending listed bank share prices sharply lower. International investors who trade Australian resources shares as a proxy for Chinese growth will keep a wary eye on today's trade.

ECONOMIC NEWS: Local unemployment figures due at 11.30 am are today's main event. Analysts expect the rate to tick up from 5.7% to 5.8%. It's a busy night in the U.S.: monthly retail sales, unemployment claims, the import price index, business inventories and natural gas storage.

Good luck to all.