MARKETS SPECTATOR: A hint of relief
With US markets closed once again due to Hurricane Sandy, the first time since 1988 that a weather event has stopped trading for two days, European markets took the lead, pushing higher on light volumes as stronger-than-expected earnings reports helped boost major oilers and banking stocks.
The French CAC 40 was the top performer, adding 1.5 per cent while the German DAX and London's FTSE 100 rose 1.12 per cent and 0.95 per cent respectively.
Whilst boosted by strong earnings reports, there was probably a hint of a relief rally too overnight as participants come to grips with the extent of damage to the US East Coast and realised that things could have been a whole lot worse.
Locally, it looks like the domestic market is set for a stronger open with futures pointing towards a gain of 0.5 per cent to 4506. Having said that, expect another session of illiquid trade as everyone will be waiting for US markets to come back online this evening before properly committing themselves.
Judging by price action in Europe, it looks like this mornings gains will be relatively broad based, with materials and cyclical names likely leading the way. In London base metals all rebounded between 0.3 per cent and 1.8 per cent while BHP Billiton and Rio Tinto added 1.8 and 2 per cent respectively.
In economic news, building approvals and private sector credit are set for release at 1130 AEDT, while steady corporate news flow looks set to continue. Origin Energy, Lynas Corp and Medusa Mining are all expected to release quarterly production figures while the likes of JB HiFi, Atlas Iron and Tabcorp Holdings are all conducting their AGMs.