daytrade diaries... june 26

Morning traders.

Market wrap: Australian shares are poised for a third straight day of gains after a strong night on Wall Street and commodity markets.

American investors ignored a rise in jobless claims and bought consumer stocks on merger news and healthy earnings in the sector, and resources stocks as commodity prices continued to bounce back from last week's losses. The Dow and Nasdaq rose 2.08% and the S&P 500 had its best day this month, up 2.14%.

Market gains were led by retailers, gold/silver miners, oilers and airlines. Crude oil topped $70 for the first time in a week, after a drop in US inventories and an attack on a pipeline in Nigeria. Oil futures were recently up more than 2% at $70.31.

Gold was higher for a third day as the US dollar eased against the euro. Gold gained 0.5% to $938.90. In another positive night for base metals, copper hits its highest level in more than a week after a US government report said the first-quarter decline in the economy was smaller than first estimated. In UK trade, copper rose 1.5%. Nickel rose 1.1%, pushing close to a new 2009 high, lead added 2%, zinc 2% and aluminum put on 1.5%, also near a new high for the year.

Our market pre-empted some of the overnight moves yesterday but futures traders reckon we're still set for a great start to the day. The SPI rose 37 points or around 1% to 3867.

Anyone who sniffed the prospect of a short-term turnaround yesterday afternoon and bought should do well this morning. Commodity prices have bounced back remarkably quickly and many of our miners are a lot cheaper than they were when commodities were last at these levels, earlier this month. For example, when nickel was last above US$7 per pound on June 11, PAN was at $2.84. Yesterday it closed at $2.42. (Disclosure: I bought late yesterday.) There are many more like it, including the big two, RIO and BHP. Happy hunting.