Welcome back Endless - top spot, Kakadu. And thanks again Suzie for all your work last week.
Half-time round-up:
Australian shares this morning gapped to their highest level in a month as US futures and Asian markets applauded Greece's election outcome.
At lunchtime the ASX 200 was ahead 65 points or 1.6% at 4123 after earlier touching a level last seen on May 18. Mining stocks led a rally that lifted all sectors except utilities (-0.4%), a traditional defensive sector. The best gains came in metals & mining +2.4%, materials +2.4% and energy +2.1%.
With 99% of the votes counted in Greece, the pro-austerity New Democracy party had 29.7% of the vote, ahead of anti-austerity Syriza with 26.9% of the vote and the socialist Pasok party with 12.3%.
"Australian investors will be relieved by this morning’s news of a probable New Democracy-led coalition government in Greece," Ric Spooner, chief market analyst at CMC Markets, told Fairfax. However, "investors are likely to remain relatively cautious at this stage. Election of a pro-bailout party is likely to be seen as merely one tick in a relatively long check list of European hurdles yet to be negotiated. The consensus view amongst investors is that the negative pressure from short-term fiscal austerity measures in Europe's high-debtor nations needs to be relieved."
The share market pared gains as Shanghai gave a characteristically restrained reaction to the news from Greece. The Shanghai composite rallied 0.43%, Japan's Nikkei 1.76% and Hong Kong's Hang Seng 1.45%. Dow futures were recently up 54 points or 0.4%.
Car sales jumped last month in another sign that the Australian economy is performing better than many economists expected. Sales of new cars increased by 2.4% per cent in May to the second-highest monthly sales volume on record.
Crude oil futures rallied 67 cents this morning to US$84.85 a barrel. A volatile morning on the gold market left spot gold recently down $5.90 at US$1,622.40 an ounce. The dollar was buying $US1.011.
Whatever the future holds, markets are just relieved that the worst has been avoided for now. Risk assets like oil, equities and the Aussie dollar are up, gold and the US dollar down. US futures figures aren't exactly exuberant but I guess their market pre-empted some of the Greek result late last week. I had a quick win on SPN first up this morning, then switched to less successful trades in PMV and KRM. SWM has been swinging nicely intraday lately and I'm ahead on that from the low.
