Local shares are poised to open flat ahead of a slew of economic data and the RBA's latest policy decision.
What you need2know:
- SPI futures up 4pts at 5944
- AUD at 77.68 US cents, 93.374 Japanese yen, 69.46 Euro cents and 50.57 British pence
- On Wall St, S&P 500 +0.4%, Dow +0.6%, Nasdaq +0.6%
- In Europe, Stoxx 50 -0.2%, FTSE -0.1%, CAC -0.7%, DAX +0.08%
- Spot gold down $US7.93 or 0.65% to $US1,205.25 an ounce
- Brent oil down $US3.02 or 4.4% to $US59.56 per barrel
What's on today
Australia balance of payments, building approvals, Reserve Bank of Australia board meeting on rates.
Stocks to watch
The following stocks will trade ex dividend today: AMP, Alumina, Amalgamated Holdings, Beacon Lighting, Bendigo Community Telco, BlueScope Steel, Centuria Capital, Cochlear, Collection House, Corporate Travel Management, Greencross, IPH, Infomedia, LifeHealthcare Group, Nick Scali, Perpetual, REA Group, Select Harvest, Servcorp.
UBS has a "buy" on TFS Corp and raised its price target to $2.65 a share from $2.60 a share after the sandalwood grower reported a "solid" result with the highlight being pharmaceutical orders.
Hartleys Research has a "buy" on Austal Limited and a 12-month target price of $1.80 a share.
Currencies
"This week could really stir the pot for Aussie crosses," says Matt Simpson, senior markets analyst at ThinkForex. "The focus will shift to RBA's rate decision on Tuesday where the market remains equally divided over whether they'll cut rates or not. So not much different to last month really. We have a plethora of data to mull and mix things up but at this stage, the downside appears more prominent for the Aussie."
Bill Gross said a global race to devalue currencies in an "undeclared" war risks slowing growth instead of stimulating it.
Commodities
UBS raised its 12-month copper forecast to $US6700 a tonne from $US5500 due to growing challenges to mine supply. "The copper story was more supply-driven. I don't think that demand angle is yet to kick in," said analyst Dominic Schnider of UBS Wealth Management in Hong Kong.
Nickel rallied in 2014 after Indonesia banned ore exports. More than a year later, prices are back where they started as the world's surplus of the refined metal is seen rising. The metal fell 1.7 per cent to settle at $US13,855 a metric ton on Monday.
United States
US stocks advanced on Monday morning to push the Nasdaq above the 5000 mark for the first time in fifteen years, as a round of mixed data pointed to a slowly accelerating economy. The Nasdaq hit a high of 5000.33 before retreating, the first time above that level since March 27, 2000, at the height of the dot.com bubble.
"Five thousand on the Nasdaq, it's been a long time coming," said Peter Kenny, chief market strategist at Clearpool Group in New York. "Now that data point, or psychological barrier, has been breached, investors are going to look at the likelihood we will continue to see the move higher in the Nasdaq and the degree to which the Nasdaq will outperform the broader market."
Fundamentals are good enough at technology companies, the biggest group on Nasdaq, that the index should be able to stay above 5000, said Peter Jankovskis, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois. "It will eventually sustain that. There may be technical orders out there that profit from selling (when it hit 5000)," he said.
Europe
European shares ended lower after setting new multi-year highs on Monday, with Greek banks slipping on lingering concerns about the country's debt and energy shares tracking a sharp decline in crude oil prices.
The Greek banking index fell nearly 10 per cent, while lenders National Bank of Greece, Piraeus Bank and Alpha Bank fell 10.0 to 11.8 per cent to feature among the top decliners. "The fears about a possible default for Greece are certainly not completely off the table," Gerhard Schwarz, head of equity strategy at Baader Bank in Munich, said.
Greece could need a third bailout deal when its current program expires in June because markets may still not be prepared to lend to its government, even with a euro-area credit line, European Commission vice president Valdis Dombrovskis said.
Telecom Italia shares rose to a four-year high on Monday after the head of French rival Orange said a tie-up between the two phone companies would be attractive. Both firms said no talks over a specific deal had occurred, while analysts and bankers said any combination of the two former monopolies would take time and require the political backing of Italy and France.
What happened yesterday
The local market pushed towards 6000 points on Monday, scaling seven-year highs, but fell short of the threshold as traders preferred to wait for the outcome of tomorrow's RBA rates decision.
