The Australian share market surged to a nine-week high this morning as Asian markets rallied and after-market earnings boosted US futures.
At lunchtime the ASX 200 was 54 points or 1.3% ahead at 4178 after touching its highest level since mid-May. All sectors were trading positive, led by a huge jump in energy stocks, up 3.7% after WPL lifted its full-year production outlook. Other notable sectors included consumer staples +2.2%, metals & mining +2% and gold +1.6%.
Asian markets advanced after a pick-up in US housing starts fuelled a second night of gains on Wall Street. Japan's Nikkei rallied 0.75%, Shanghai 1.02% and Hong Kong's Hang Seng 1.71%.
"The US economy has gone through a bit of soft patch, but the housing sector does seem to be heading for recovery, which is positive from a longer-term perspective for America," Shane Oliver, head of investment strategy at AMP Capital Investors told Bloomberg. "The market still likes what it sees."
US futures hinted at further gains tonight following a positive reaction to earnings results posted by IBM, EBay and Yum Brands after the close of regular trade this morning. Dow futures were recently up 28 points or 0.2%.
Business confidence and conditions deteriorated during the June quarter as Europe's debt crisis weighed on sentiment, data released this morning showed. NAB's quarterly survey had confidence decline from -1 to -2 and conditions ease from 3 to 1. The survey was conducted just before Greece's election re-run.
Crude oil futures rose 23 cents this morning to US$90.17 a barrel. Spot gold was $4 firmer at US$1,576.80 an ounce. The dollar was buying $US1.0387.
A bullish morning all round, with the XJO extending its gains and oil, gold and the dollar all on the rise. Shanghai was the last tick in the box once it overcame early weakness. Woodside's result was a bell-ringer that may encourage overseas investors to take another look at the Australian resources sector. As for me, in the last few weeks I've finally been enjoying a little of that elusive trading skill, dumb luck. I bought RRS yesterday purely for an intraday bounce, sold half for a modest profit and would have punted the lot if the price had been right. Today: bingo, oil shows and a big rally. Congrats to Haspete and the other true believers who are more deserving of the windfall. Also exited GRR for peanuts and added a speculator in PNA, tight stop.
