daytrading may 28 pre-market

Morning traders. Thanks Trees.

Market wrap:

Shares are likely to open little changed as declines in gold and iron ore temper another record close on Wall Street.

The June SPI 200 futures contract edged up just six points or 0.1% to 5533 as materials stocks were left behind during a 'risk-on' session in the US.

The S&P 500 rallied 11 points or 0.6% to 1,911.95, its second straight record close, as traders welcomed merger news and another round of upbeat economic data. The Dow gained 70 points or 0.42% and the Nasdaq added 51 points or 1.22% as a recovery in tech stocks and small caps continued. The Russell 2000 put on 1.42% and has gained more than 3% in four sessions.

"Gold is positively hammered and the fact that the S&P 500 is trading above the 1,910 level suggests there is a real flow of capital back into riskier assets and away from havens," Colin Cieszynski, chief market strategist at CMC, told MarketWatch. "After new highs in the industrials and transports a few weeks ago, this is a confirmation that there is breadth to this rally."

Orders for big-ticket items in the US increased for a third month despite downbeat expectations. Durable-goods orders rose 0.8% in April, extending an upwardly-revised 3.6% gain in March. Economists polled by Bloomberg had expected orders to decline by 0.7%.

Consumer confidence edged up this month, in line with expectations. The Conference Board index improved to 83 from 81.7 last month. Another report showed house prices increased in March for the first time in five months, but annual growth continued to moderate.

The fresh evidence of strength in the US economy helped drive gold to its lowest point in three and a half months as traders rotated cash into cyclical assets. Gold for June delivery dropped $26.20 or 2% to settle at US$1,265.50 an ounce, the lowest level since early February. The New York Stock Exchange Gold Bugs Index sagged 4.1%.

"Surprisingly, this technical breakdown has taken place despite a typically gold-bullish fundamental development: escalating violence in Ukraine," Matt Weller, senior technical analyst at Forex.com, told MarketWatch. "The yellow metal's failure to rally despite the ostensibly strong fundamental story line is a telling sign that more weakness may be on the horizon."

Tech stocks, financials and utilities were the pick of the US sectors. Energy and materials brought up the rear. Australia's biggest miners were little changed following a dip in the price of iron ore yesterday. BHP gained 0.2% in US trade and Rio Tinto slid 0.07%. Spot iron ore for import to China yesterday fell 50 cents to US$98.10 a dry tonne.

Base metals closed mixed after trade resumed on the London Metal Exchange following Monday's holiday. Copper rose 0.1%, aluminium 0.8% and zinc 0.2%. Nickel lost 0.3% and lead 0.2%. Tin was flat. US copper for July delivery was recently up 0.1% or a fraction of a cent at US$3.17 a pound.

Continued fighting in east Ukraine put a floor under the price of oil despite a positive reaction to the election of chocolate billionaire Petro Poroshenko as President over the weekend. West Texas Intermediate crude oil for July delivery dropped 24 cents or 0.2% to settle at US$104.11 a barrel.

European markets continued to rally on expectations that the European Central Bank will stimulate the euro-zone economy at next week's monthly meeting. The Stoxx Europe 600 index gained 0.23% as Germany's DAX advanced 0.49%, France's CAC 0.07% and Britain's FTSE 0.43%.

TRADING THEMES TODAY

TWO-SPEED MARKET?: The financials and industrials will likely have to do the heavy lifting today if the XJO is to threaten the April six-year high. BHP and Rio Tinto closed little changed in the US as resource stocks somehow missed the bus ride to a new S&P 500 record close. Iron ore continues to consolidate around current levels. The question is whether this is a pause in the downtrend or genuine base-building. Gold stocks were flogged in the US and are likely to meet similar treatment here. Small caps and biotechs have broken their US downtrends and look well on the road to recovery.

ECONOMIC NEWS: The Melbourne Institute's monthly leading index of economic indicators is due at 10.30am EST, followed by quarterly construction work data at 11.30am. A quiet night ahead in the US offers no significant scheduled economic reports.

Good luck to all.