Bourse set for solid start to week as oil prices take off
THE sharemarket is expected to open higher this morning, with the futures market suggesting a gain of 30 points, after the head of the International Monetary Fund said European and US financial markets showed signs of stabilisation.
THE sharemarket is expected to open higher this morning, with the futures market suggesting a gain of 30 points, after the head of the International Monetary Fund said European and US financial markets showed signs of stabilisation.Oil stocks are also expected to get a boost from a surge in the price of oil - West Texas Intermediate crude oil rose 2 per cent to $US107.25, while Brent crude oil jumped 2.9 per cent to $US126.10 - as a positive US lead on Friday is expected to filter through to the local bourse.Speaking in Beijing yesterday at the China Development Forum 2012, Christine Lagarde, the managing director of the IMF, said the world economy had "stepped back from the brink" and had cause to be more optimistic."Just a few months ago, the situation was decidedly gloomy," Ms Lagarde said."Indicators for the last quarter of 2011, namely for Europe and the United States, did not provide much reassurance."Yet, today, we are seeing signs of stabilisation signs that policy actions are paying off."The CommSec chief economist, Craig James, said the futures market was pointing to a gain of 30 points at the start of trade, probably led by energy stocks after the rise in the price of oil."For our market, the oil price was up significantly so that's going to be good news for the energy stocks," Mr James said.Other sectors would probably make gains in a delayed reaction to a positive US lead on Friday that failed to produce gains in the local market that day, he said.Miners BHP Billiton, Rio Tinto, and Fortescue Metals escaped unscathed after tropical cyclone Lua battered the Pilbara region on Saturday. The port of Dampier, used by Rio Tinto, remained open.Port Hedland, the world's biggest iron ore port used by BHP and Fortescue, reopened yesterday.This week will be dominated by US housing figures and the release of minutes of the Reserve Bank's monetary policy meeting earlier this month.On the corporate front, first-half earnings results for this year will be posted by David Jones, Sigma Pharmaceuticals, Brickworks, Washington H Soul Pattinson and Premier Investments.