Morning traders. Thanks Meme.Market wrap: The market is poised...

Morning traders. Thanks Meme.

Market wrap:

The market is poised to open at five-and-a-half-year highs after Wall Street hit record levels overnight and European stocks marked a six-year peak.

The March SPI 200 futures contract jumped 27 points or 0.5% to 5450 as the S&P 500 breached technical resistance on optimism over increasing merger activity.

Energy, industrials and financials led the rally as the S&P 500 recorded a new intraday record high before missing a record close by less than a point on a final gain of 12 points or 0.64%. The Nasdaq advanced 30 points or 0.69% to its highest point since 2000. The Dow added 106 points or 0.66%. The rally gathered momentum after the S&P 500 broke above this month's closing high at 1,841.

"That, probably from a technical perspective, provided some enthusiasm for stocks," Mark Luschini, chief investment strategist at Janney Montgomery Scott in the US, told Reuters. "The macroeconomic risk of some kind of encounter in the Ukraine seemed to dissipate with the removal of the president and some calm being restored."

European stocks pushed to levels last seen in January 2008 following news that the Ukrainian President Viktor Yanukovich had been deposed and a strong reading on German business confidence. The Ifo German business climate gauge rose to 111.3 this month from 110.6 in January, its fourth straight improvement. The Stoxx Europe 600 index advanced 0.63% as Germany's DAX gained 0.54%, France's CAC 0.87% and Britain's FTSE 0.41%.

US traders have been encouraged by a recent pick-up in merger activity. The night's news included a deal for RF Micro Devices to buy TriQuint Semiconductor for US$1.6 billion and an increased offer from Men's Wearhouse for Jos A Bank Clothiers. Health stocks saw substantial gains after Humana announced that government cuts to the Medicare program were not as severe as anticipated.

Australia's biggest miners closed mixed after the price of iron ore dropped below US$120 a tonne following news of a slowdown in the Chinese housing market. The Shanghai Composite dived 1.74% yesterday. In US trade, BHP rallied 0.25% while Rio Tinto fell 1.53%. Spot iron ore for import to China slumped $2.50 to US$119.90.

The Chinese news pushed copper to a two-week low during a soft session for base metals. US copper for March delivery was recently off 0.85% or about three cents at US$3.26 a pound. In London, copper lost 1.1%, aluminium 0.45%, lead 0.8%, nickel 0.2% and tin 0.7%. Zinc edged up less than 0.1%.

Gold settled at its highest level since October as traders hedged against further deterioration in US economic data. Gold for April delivery was lately up $13.50 or 1% at US$1,337.10 an ounce after settling at US$1,336.70.

Oil also recorded its best close since October. West Texas Intermediate crude oil for April delivery was recently up 47 cents or 0.5% at US$102.66 a barrel after settling at US$103.22.

TRADING THEMES TODAY

BREAKOUT? A late fade on Wall Street muddied the final outlook somewhat, but it still looks like the XJO has a shot at breaking overhead resistance today. To do so, the market will have to find enough strength in non-mining related sectors to overcome a fall in the price of iron ore below US$120. Energy and precious metals look fine, but industrials and iron ore may feel some heat from yesterday's gentle moderation in Chinese housing price appreciation. The reporting season should continue to provide trades. Among companies reporting today are AUB, AVJ, AWE, CAB, CHC, DMP, OSH, QBE, RHC, SFW, VED (sources: BRR, Fairfax).

ECONOMIC NEWS: No significant domestic news scheduled today. There is a leading index for China due at 1pm EST but it usually has little impact. The European Union releases tri-annual economic forecasts for member states tonight. US highlights include consumer confidence, the Richmond Manufacturing Index and the house price index.

Good luck to all.