Shares look set for their highest open in a week as gains on Wall Street strengthen hopes that the worst of the Nasdaq-led US market correction is behind.
Australianindex futures climbed 44 points or 0.75per cent, indicating optimism about the session ahead after yesterday'slacklustre 0.1 per cent loss.
BHP and Rio Tinto rose in overseas trade despite setbacks for iron ore and most base metals. Oil and gold rose. The dollar ticked back above 73 US cents.
WallStreet
A second day of strong gains for the battered tech megacaps fired the Nasdaq Composite to a final tally of 134 points or 1.21 per cent. Tesla put on 7.2 per cent, Netflix 4.1 per cent, Facebook 2.4 per cent, Amazon and Alphabet 1.7 per cent and Microsoft 1.6 per cent.
“Themarket is doing its best to prove that buyingthe dip still is in vogue,” Frank Cappelleri, executive director atInstinet, told CNBC.
The S&P 500 gained 18 points or 0.52 per cent, with the communication services, REITs and consumer discretionary sectors all adding at least 1 per cent. The Dow Jones Industrial Average was hamstrung by declines in industrial heavyweights Caterpillar and Boeing and financial powerhouse Goldman Sachs and JPMorgan Chase, closing with a meagre gain of two points or 0.01 per cent.
Themarket mood was helped by upbeat US and Chinese economic data ahead of tonight's policy statement from the FederalReserve. The Empire State Manufacturing Index rose to 17 this month from 3.7last month, twice the gain expected by economists. A report yesterday showedChina's industrial production accelerated last month at the strongest pace ineight months.
Australianoutlook
Local investors appeared to sit on their hands yesterday while they awaited more evidence the technical correction in US Big Tech had run its course. The signs this morning appear favourable, with the S&P 500 closing at its highest level since the second day of the tech plunge and the Nasdaq rising for a second session.
“Thepullback we had is now behind us,”Peter Cardillo, chief market economist at Spartan Capital Securities, toldReuters.
The S&P/ASX 200 fell five points or 0.1 per cent yesterday as declines in the big banks and energy stocks offset gains in most of the miners and the much of the broader market. Financials missed the upswing in the US overnight, falling 1.4 per cent, a potentially ominous sign for our banks today.
