Australian Stock Market Report today May 19 2011

Australian Stock Market Report today May 19 2011 : The release of the FOMC minutes indicated that it is unlikely that the Fed will begin tightening policy this year. Majority of board members are still concerned that ´´an early exit could unnecessarily damp the ongoing economic recovery.´´ However the more hawkish members ´´thought that economic conditions might warrant action... later this year.´´ Members commented that ´´there would need to be a significant change in the economic outlook... before another program of asset purchases would be warranted´´.

European shares rallied in a choppy trading session Wednesday. Mining and energy stocks were the best performers, supported by a boost in commodity prices. The STOXX Europe 600 basic resources index gained 0.7pct, Ongoing sovereign debt concerns in the peripheral euro zone economies capped gains. The FTSEurofirst index closed up 0.4pct while the German Dax rose by 0.7pct and the UK FTSE was up by 62pts or 1.1pct.

US sharemarkets rallied for the first time in four sessions on Thursday. The rally was driven by the strength in commodity prices. The CRB futures index - a broad measure of commodity performance - rose 2.3pct. The S&P materials index added 2pct. The upbeat earnings result from Dell (up 5.4pct), late in the session on Tuesday supported technology stocks. The Dow Jones rose 81pts or 0.7pct with the S&P 500 up 0.9pct and the Nasdaq gained 32pts to 1.1pct.

US treasuries fell on Tuesday (yields higher) as investors took profits from the recent rally that pushed yields to the lowest levels since December. The rally in commodities also supported a shift to riskier asset classes. US 2yr yields rose by 34pts to 0.56pct and US 10yr yields rose by 6pts to 3.18pct.

The US dollar rallied against major currencies on Wednesday as the latest FOMC minutes indicated that the Fed was eyeing an exit strategy, although it is unlikely to be in the immediate future. The Euro fell from highs near US$1.4280 to US$1.4205, before ending US trade near US$1.4240. The Aussie dollar fell from highs near US106.45c to US105.65c before ending US trade near US106.20c. And the Japanese yen eased from 80.90 yen per US dollar to JPY81.70, ending US trade near its lows.

US and European crude oil prices rose on Wednesday with further support coming from the latest EIA inventory data. US crude stockpiles fell by 15,000 barrels against expectations for a 1 million barrel build. The Nymex crude oil contract rose by US$3.19 or 3.3pct to US$100.10 a barrel and London Brent crude rose by US$2.31 to US$112.30 a barrel.

Base metal prices were mostly higher on the London Metal Exchange on Wednesday, with copper rallying to a one week high. And the gold price rallied on Wednesday, with Comex gold futures up by US$13 an ounce to US$1,495.80.

Ahead: In Australia, AWOTE figures are released. In the US, existing home sales and leading indicators are released.( source : hken.ibtimes.com ) For the latest updates PRESS CTR + D or visit Stock Market news Today

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