Bourse tipped to drift after subdued offshore trading
THE sharemarket is expected to open marginally weaker today in the absence of a strong lead from the US.
THE sharemarket is expected to open marginally weaker today in the absence of a strong lead from the US.The AMP Capital Investors head of investment strategy and chief economist, Shane Oliver, said futures trading pointed to a 12-point, or 0.3 per cent, fall on the benchmark ASX 200 index today.While a modest rise on European and US markets on Friday was driven by gains in financial stocks and commodity stocks due to a high oil price, there was "not a lot of action on Wall Street", Dr Oliver said."Housing data out of the US was on the soft side, with home sales down, so it's a fairly weak lead for our market," he said.On Wall Street on Friday, the Dow Jones Industrial Average closed up 34.59 points, or 0.3 per cent, at 13,080.73 points. The S&P 500 index added 4.33 points, or 0.3 per cent, to 1397.11 points and the tech-heavy Nasdaq Composite rose 4.6 points, or 0.1 per cent, to 3067.92.Dr Oliver said most commodities prices had rebounded mildly on the London Metal Exchange on Friday after falling on Thursday, which should provide support for local resources stocks. "We might see a bit of strength in some of the miners offset by weakness in other parts of the market," he said."The oil price was up 1.3 per cent and of course, that's a double-edged sword: on the one hand, it's good because commodity prices are up but on the other hand, it's bad because it slows global demand."Oil prices rose following a report that Iranian oil exports had fallen substantially this month.Copper, which is seen as the bellwether for industrial metals demand, was also up 1.1 per cent in London trading on Friday.While the futures market pointed to a softer open on the bourse today, it could manage a flat albeit subdued performance, given the futures market "hasn't been a great guide lately", Dr Oliver said. The ASX 200 index has been struggling below the 4300-point level for some time."The Australian market won't break out until either we see some combination of a definitive [monetary policy] easing in China ... or [a] monetary easing in Australia with the Reserve Bank cutting interest rates, or a much weaker Australian dollar," Dr Oliver said.AAP