Market wrap: Stocks look set to open in positive territory for a fourth straight session after bright trading in metals and a mixed night on Wall Street.
U.S. indexes closed little changed as energy shares followed the oil price lower and bearish analyst comments weighed on the financial sector. Strength in tech stocks carried the Nasdaq to a gain of 0.42% but the S&P 500 closed flat at +0.03% and the Dow lost 0.18%.
Sentiment in the financial sector was hurt by UBS slashing their fourth-quarter earnings targets for Morgan Stanley, JP Morgan, Bank of New York Mellon Corp and others. The S&P Bank Index closed 0.39% lower.
Also crimping gains was news that private-sector employment fell by 169,000 jobs in November, more than the 150,000 jobs that economists had expected. Weekly jobless claims data are due tonight and government data on monthly nonfarm payrolls are due on Friday.
The afternoon release of the Federal Reserve's Beige Book of regional economic indicators made little impact on the market. The central bank said economic conditions "improved modestly" in late October and early November, but a weak labour market and deteriorating commercial real-estate sector remain concerns.
There were pockets of strength in U.S. trade: precious metals miners advanced 2.22%, airlines 3.68%, transport stocks 1.68%, REITs 1.54% and utilities 1.3%.
The major European markets built on Tuesday's big advance. Britain’s FTSE added 0.29%, Germany’s DAX 0.09% and France’s CAC 0.53%.
Gold notched up its 19th new closing high since the start of November as the U.S. dollar wallowed near 15-month lows. The spot gold price was trading recently at $1,214.60 an ounce, up more than $18 from yesterday's last price.
This week's recovery in the price of oil was stopped by a rise in U.S. inventories and continuing evidence of weak demand. Crude stockpiles rose 2.1 million barrels last week, while total petroleum demand fell 2.6%. Current petroleum demand in the U.S. is 6.5% below last year's level. Crude oil futures tumbled 2.26% in response, trading recently at $76.67 a barrel.
The picture was brighter for base metals - copper, aluminium, lead and zinc hit fresh 2009 highs in London on positive jobs data out of the US and confirmation of strength in the Chinese economy. Copper rallied 0.57%, aluminium 2%, zinc 2.02%, lead 0.08%, nickel 0.49% and tin 0.63%.
Futures traders expect our market to open modestly higher. The SPI futures index added 6 points at 4771.
TRADING THEMES TODAY
METALS: Apologies for repeating yesterday's message but you gotta stay with the heat in the market. New overnight highs for gold, copper, aluminium, zinc and lead are a strong pointer for where the strength is likely to be in our market today.
ECONOMIC NEWS: The Australian Industry Group releases its monthly survey of business conditions at 9.30 am. Retailers come under the spotlight at 11.30 am with the release of October retail sales data. In the US tonight: unemployment claims, Fed Reserve Chairman Bernanke's confirmation hearing, the non-manufacturing purchasing managers index, non-farm productivity data and labour costs.
