daytrades may 27 pre-market

Morning traders.

Market wrap: A flat open is likely after US stocks advanced amid more disappointing economic news overnight and commodity markets ended mixed.

The June SPI futures contract closed the night session 5 points or 0.11% stronger at 4674, boosted by gains in the big local miners in US trade.

US stocks languished for much of the session after weekly jobless claims unexpectedly increased and GDP missed expectations. But the major indexes turned higher in afternoon trade as corporate profits continued to defy the weak economy, highlighted by an upgraded outlook from retailer Tiffany. The benchmark S&P 500 rose for a second day, gaining 0.4%. The Dow eked out an eight-point or 0.07% gain and the Nasdaq rallied 0.78%, with technology one of the night's stand-out sectors.

First-quarter US GDP came in at a tepid annual rate of 1.8%. Economists polled by Bloomberg had tipped a rate of 2.2%. Problems in the job market were underlined by a 10,000 increase in weekly claims for unemployment benefits to 424,000.

"The bright side is that there's a clear dichotomy between the health of corporate America and the economy," the chief investment strategist at Janney Montgomery Scott told Bloomberg. "Profits remain good and there's M&A activity. That tells me that we're not going to see a huge move in stocks in either direction."

The Australian dollar benefitted from traders rotating out of the US dollar as the night's soft economic news pushed out the prospect of interest rate rises in the US. The Aussie was recently up more than one cent at US $1.064. The US dollar index was recently off 0.5%.

Oil retreated on demand concerns following the US GDP and jobless numbers. Crude for July delivery was recently off $1.14 or 1.1% at US $100.18 a barrel.

Gold softened after rising for four straight sessions, and silver drifted after rallying more than 3% over each of the last two sessions. Gold for June delivery was recently down $7.70 or 0.5% at US $1,519 an ounce. July silver dropped 39 cents or 1% to US $37.25 an ounce.

A mixed night for industrial metals gave no pause to the big Australian miners in US trade. BHP and Rio Tinto both put on 1.75%. Alumina added 1.6%. In London, copper added 0.2%, aluminium 1.1% and zinc 0.8%. Lead fell 0.7%, nickel 1.7% and tin 3.2%. US copper was recently up 0.3%.

European shares mostly weakened after European official Jean-Claude Juncker cast doubt on whether the International Monetary Fund will meet its commitment to Greece because the Greek government cannot guarantee repayment within 12 months. Germany's DAX dropped 0.79% and France's CAC 0.3%. Britain's FTSE rallied 0.19%.

TRADING THEMES TODAY

MIXED BAG: The outlook is muddy this morning, with commodity markets mixed and Wall Street rising for reasons that don't necessarily benefit our market. Oil and precious metals fell but copper squeezed out another rise. Our dollar kicked higher again overnight, pressuring exporters and other companies who derive most of their profits overseas. The strongest US sectors were technology and consumer discretionary stocks.

BAD NEWS ONCE AGAIN GOOD NEWS FOR STOCKS: The worse the economic news gets in the US, the less likely it is that the Federal Reserve will raise interest rates any time soon. In fact, proponents of QE3 will be rubbing their hands at the prospect that the Fed will have no choice but to keep pumping money into the economy if the recent run of weak reports continues. Some of that cash will find a home in the stock market. Another side-effect is that the US dollar will continue to slide as investors rotate into higher yielding currencies such as the Australian dollar.

ECONOMIC NEWS: Nothing on the local calendar today but Japanese inflation and retail sales figures are due shortly before our market opens. The week's most important scheduled US news is out overnight but this evening brings monthly pending home sales, core price index, personal spending, personal income, revised consumer sentiment and revised inflation expectations.

Good luck to all.