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Morning (AM) Market Report

US stocks have advanced, with the Dow and S&P 500 on track for their seventh gain in eight sessions, buoyed by stocks in economically sensitive areas such as industrials and technology.

Thursday, 22nd February, 2018

After the Federal Reserve left interest rates unchanged in January, minutes of that meeting released on Wednesday show that the central bank's rate-setting committee grew more confident in the need to keep raising rates, with most believing that inflation would perk up. Expectations for a quarter-point hike at the Fed's next meeting, in March, are currently 93.5 percent, according to Thomson Reuters data. The central bank has forecast three rate hikes in 2018. Since inflation worries knocked the S&P 500 down more than 10 per cent from its January 26 high, stocks have rebounded in recent sessions as yields on the 10-year US Treasury note have stabilised around the 2.9 percent mark. As inflation concerns have ebbed, names likely to benefit from synchronised global growth have come into favour. Industrials, up 1.45 per cent, have been the best performing on the 11 major S&P sectors on Wednesday. Materials stocks climbed 1.13 per cent. However, by late afternoon, some of the shine had come off the lifts.

In late trading, the Dow Jones Industrial Average is up 0.17 percent at 25,007.56, the S&P 500 has gained 0.57 percent to 2,739.81 and the Nasdaq Composite has added 0.60 percent to 7,277.78, having fallen back from lifts of 0.88 per cent, 0.87 percent and 1.18 percent, respectively.

European shares have closed in positive territory on Wednesday, recouping earlier losses as Wall Street opened higher and upbeat earnings published by Lloyds and Glencore gave a boost to financial stocks and miners. New business activity data from the euro area eased concerns that ultra-easy monetary policy in the bloc could end sooner rather than later. Europe's pan-European STOXX 600 index closed up 0.16 per cent at 381.1 points but some bourses on the continent ended the day slightly in the red, like Germany's DAX which closed 0.14 per cent lower at 12,470.49. Britain's FTSE outperformed its European peers with a near half a per cent rise, with heavyweight Glencore up 5.2 percent following a set of full-year results described as the miner's "strongest on record". That helped the basic resources index rise 1.6 percent. The FTSE 100 closed 0.48 percent higher at 7281.57 points after spending part of the day in the red in a session that was in sharp contrast to the previous one.

The key Asian markets that were trading following Lunar New Year holidays rose. MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.7 per cent after slipping earlier in the session following the US market losses, which snapped a six-session winning streak. Japan's Nikkei trimmed earlier gains but still ended the day 0.21 percent higher at 21,970.81. And, Hong Kong's benchmark Hang Seng index rose 1.81 percent to finish at 31,431.89.

Ahead of the local open SPI futures were 2 points higher at 5,916.

Foreign Equities Close Change % Change 
Dow Jones (US)  24798


FTSE 100 Index 7282 35 0.48
HKSE 31432 558 1.81
NASDAQ 7218 -16 -0.22
Nikkei 225 (Japan) 21971 46 -0.21
NZ50 8098 -- --
S&P 500  2701 -15 -0.55
Commodities US$ Close Change % Change 
Aluminium  /t 3mth 2211 -5 -0.21
Copper  /t 3mth 7078 30 0.43
Gold  /oz 3mth 1323 -5 -0.37
Lead  /t 3mth 2547 -47 -1.82
Nickel  /t 3mth 13797 238


Oil - West Texas Crude  /t 3mth 61.7 -0.1 -0.18
Zinc  /t 3mth 3568 -1 -0.02
Currency Close Pts Change % Change 
$A vs $US 0.7806 -0.0074 -0.94
$A vs GBP 0.5607 -0.0020 -0.36
$A vs EUR 0.6352 -0.0035 -0.55
$A vs YEN 84.07 -0.54 -0.64
$A vs NZD 1.0665 -0.0066 -0.62