daytrades sep 29 pre-market

Morning traders.

Market wrap: A rebound on Wall Street and a strong night for metals point to a positive start to local trade.

The December SPI futures contract closed 17 points stronger at 4715 this morning after Wall Street shrugged off a surprise plunge in consumer confidence.

The Dow tumbled more than 80 points in early trade but recovered to close 46 points or 0.43% higher as consumer stocks and pharmaceutical companies rallied. The S&P 500 added 0.49% and the Nasdaq 0.41%. Gold, silver and industrial metals all improved as the U.S. dollar resumed its down-trend.

Wall Street staggered at the open after the Conference Board's consumer confidence index slumped from 53.2 in July to 48.5 last month - well below economists' expectations for a slight decline to 52.1. The reading was the worst in seven months.

"Even though the recession has been officially over for quite some time, it still feels like one to consumers," Lynn Franco, a director at the Conference Board told MarketWatch. "We have yet to see strong job growth, and that is the dark cloud hanging over consumers."

The dollar sagged, gold and silver rallied, and equity indexes rebounded quickly as investors continued to buy dips. Consumer stocks were boosted by a bright earnings report from pharmacy chain Walgreen, while the big drug-makers rallied after a favourable Supreme Court decision.

The dollar index, which measures the U.S. currency against a basket of major currencies, slid to its lowest level since January. The index, which tends to have an inverse relationship with dollar-denominated commodities, was recently trading 0.6% lower at 78.92.

Precious metals were a major beneficiary as investors sought hedges against the falling value of the greenback. Gold smashed through the $1,300 mark to a new record high - its eighth in the last nine sessions - and silver carved out a fresh 30-year peak. The spot gold price was recently $14.70 than Monday's New York close at $1,309.30 an ounce. Spot silver was up more than 1% at $21.74.

Copper for December delivery recorded its highest settlement price since July 2008 as the weak consumer confidence data dimmed the outlook for the U.S. dollar. In late trade in London, copper was up 0.9%, aluminium 0.7%, lead 0.5%, nickel 0.4%, tin 1.4% and zinc 0.4%.

"There is still a general fear that the dollar is heading lower," a futures analyst with Archer Financial Services in the U.S. told Reuters. "The major demand for these markets has been coming from overseas and their purchasing power just keeps increasing because of the weak dollar."

Oil continued its slide on demand concerns after the consumer confidence data and ahead of this week's U.S. inventory updates. Crude futures were recently off 29 cents or 0.4% at $76.23 a barrel.

European markets ended a volatile session little changed as sovereign debt concerns continued to drive sentiment. Britain's FTSE added 0.09%, Germany's DAX fell 0.04% and France's CAC lost 0.1%.

TRADING THEMES TODAY

METALS: Gold is not the only metal that glitters this morning - the U.S. dollar's woes make all metals look pretty attractive. Gold pushed decisively through $1,300, silver is up 29% so far this year, December copper is at a two-year high and the other base metals are at or near multi-month highs. So long as the market expects further quantitative easing from the Federal Reserve, the U.S. dollar will slide and the outlook for dollar-denominated metals will remain rosy.

CHINA BOUNCES BACK? Today's most-anticipated scheduled economic news is the Chinese purchasing managers' index, due at 12.30 pm. The index, a useful tool for assessing likely demand for Australian commodities, hit a 17-month low in July but recovered in August. Seasonal factors are expected to help it show further recovery today. Our market is increasingly responsive to intraday moves in Asian markets, so a strong or weak reading could change the course of trade for the rest of the session.

ECONOMIC NEWS: The monthly leading index of local economic indicators is due at 10 am. Monthly new home sales are also due today (time uncertain). The Chinese PMI is due at 12.30 pm (see above). Crude oil inventories are the highlight of an unusually light schedule in the U.S. tonight.

Good luck to all.