daytrading march 16 pre-market

Morning traders.

Market wrap:

Stocks are set to open at a two-week high after bullish US economic news pushed the S&P 500 above 1,400 for the first time since 2008.

The June SPI 200 futures contract, now the most active, ended the night session 21 points or 0.5% stronger at 4309 as metals prices rebounded and BHP and Rio Tinto advanced in US trade.

Cyclical companies led a rally on Wall Street after manufacturing in the New York area expanded and jobless claims resumed their downtrend. The S&P 500 is now within 10% of its all-time high after last night rising 0.6% to 1,403. The Dow rallied for a seventh night, adding 59 points or 0.45% as its biggest company, IBM, hit a new peak. The Nasdaq put on 0.51%.

First-time claims for unemployment benefits dropped 14,000 last week to 351,000, matching a four-year low. A gauge of manufacturing in the New York region rose to a 21-month high and a separate report on the Philadelphia region delivered its best result in nearly a year.

"The US economic numbers are quite encouraging," the chief investment officer at Philadelphia Trust in the US told Bloomberg. "Stocks have reached new highs, but valuations are reasonable. People who haven't gotten into the market might be drawn in because the economy is improving and there are some relative good values out there."

Financials and industrials led the rally but the closely-watched Dow Jones Transportation Average, a proxy for the US economy that has underperformed lately, jumped more than 3%. Mining stocks recovered some of yesterday's losses as a pullback in the US dollar drew investors back into commodities. BHP put on 1.5% in US trade and Rio Tinto gained 2.3%. Alumina lost 0.15%.

Gold rebounded from an eight-week low, recouping around a third of Wednesday's 3% plunge. Gold for April delivery was recently up $15.60 or 1% at US$1,658.50 an ounce.

Most base metals improved, led by copper after London warehouse levels dropped to their weakest level in more than two and a half years and mining giant Freeport-McMoRan reduced its first-quarter sales forecast. In London, copper added 1.25%, aluminium 1.1%, lead 1.2% and zinc 1%. Nickel lost 1.1% and tin 0.4%. US copper was recently up 1.3%.

US oil was lately little changed after recovering from a mid-session wobble on reports that the US and Britain have agreed to release some of their reserves to ease the pressure on oil prices. The report, quickly dismissed by the White House, pushed crude for April delivery briefly below US$104 a barrel but the contract was recently off just 16 cents or 0.15% at US$105.27.

Most of the major European markets advanced after the International Monetary Fund approved its share of the second rescue package for Greece. Germany's DAX rallied 0.92% and France's CAC 0.44%. Britain's FTSE eased 0.08%.

TRADING THEMES TODAY

EXTENDING THE RALLY: Barring surprises, a strong week on the ASX looks likely to end on a positive note, with overseas equities and commodity prices mostly moving in our favour overnight. However, the XJO will once again start the day near the 4300/4310 level that has proved a ceiling to our ambitions lately, raising the risk of the familiar "Friday fade". A decisive breakout is overdue, but when? Conditions at the smaller end of town remain more bullish - yesterday was the first reversal on the XSO in six sessions. Among the US sectors last night, financials and transport stocks were strong, small caps outperformed and oilers were mixed.

ECONOMIC NEWS: No significant domestic reports scheduled for release today. Tonight's highlights in the US include: preliminary consumer sentiment and inflation expectations, the consumer price index and core CPI, industrial production and capacity utilisation rate.

Good luck to all.