daytrades oct 19 pre-market

Morning traders.

Market wrap: Australian shares are set to open nearly 1% stronger after a rebound in commodity prices and overseas equities.

The December SPI futures contract finished 41 points or 0.88% higher this morning at 4696 as weak U.S. economic data quashed a rebound in the U.S. dollar and encouraged buying in equities as the odds on central-bank intervention increased.

U.S. equity indexes pushed closer to 2010 highs after strong earnings from Citigroup steadied nerves in the banking sector. The Dow rallied 81 points or 0.73% to 11,144, less than 60 points from the April high. The S&P 500 added 0.72% and the Nasdaq 0.48%.

"We remain positive on the market based on decent earnings and the Fed's expected actions," the chief investment strategist at Old Second National Bank in the U.S. told Bloomberg. "Even Citigroup beat earnings, which is kind of amazing considering the problems we're seeing on the foreclosure front."

Bank stocks in the U.S. faced heavy selling last week over concerns about a nationwide investigation into mortgage foreclosures, but rebounded overnight after Citigroup said more customers repaid loans last quarter.

The U.S. dollar erased early gains after a surprise dip in industrial production increased speculation that the Federal Reserve will stimulate the economy at next month's meeting. The dollar index was recently down 0.11% after earlier being up around 0.8%.

The falling greenback helped commodities recover early losses. Oil hit its highest level in a week as strikes in France disrupted output at French refineries. Crude futures rallied $1.97 or 2.4% to $83.22 a barrel.

Precious metals turned higher after weakening towards the end of last week. The spot gold price was recently $5.10 higher than Friday's New York close at $1,374 an ounce after earlier falling below $1,355. December silver rallied 13 cents to $24.41 an ounce.

Industrial metals were mostly stronger. In late trade in London, copper was up 0.8%, aluminium 1.7%, lead 1.9%, tin 0.1% and zinc 0.5%. Nickel was 0.1% lower.

Gains in European banks offset weakness among mining stocks. Britain's FTSE rallied 0.69%, Germany's DAX 0.37% and France's CAC 0.19%.

TRADING THEMES TODAY

REBOUND: Two weak sessions of local trade should be overcome at today's opening bell after another bout of "bad-news-is-good-news" buying in the U.S. You may not like the theme - I don't - but it's dragging Wall Street back to the April 2010 high and may help our market break out of its recent sideways trading range. We should open near resistance this morning, which may cause some concern, but a breakout looks increasingly likely with the U.S. dollar decline continuing to support resource prices.

APPLE AND IBM EARNINGS: This U.S. earnings season is off to a healthy start. Two of the big guns in technology were due to report shortly after the market closed this morning: Apple and IBM. Their results will have a large bearing on the outlook for tonight in the U.S. Track the response here.

ECONOMIC NEWS: The minutes from the last Reserve Bank meeting are due at 11.30 am. Housing is the main theme in the U.S. tonight, including housing starts and building permits. There are also public appearances due from various members of the closely-watched Federal Open Market Committee.

Good luck to all.