Local stocks are poised to open higher on a positive lead from Wall St.

Federal Reserve chair Janet Yellen said the US economy was still in need of support given the 'considerable slack' in the labour market. 

What you need2know:

 

• SPI futures up 35 points to 5455

• AUD at 93.33 US cents

• On Wall St, S&P500 +0.56%, Dow Jones +0.72%, Nasdaq -0.32% 

• In Europe, Euro Stoxx 50 +0.31%, FTSE100 -0.03%, CAC +0.41%, DAX +0.57%

• Spot gold down $US18.03 to $US1290.02 an ounce

• LME copper up $US1 to $US6720 a tonne

• Brent oil up $US1.10 to $US108.16 per barrel

 

What’s on today

 

National Australia Bank: First-half results

Australia is expected to release jobless figures for April at 11.30am AEST.

 

Stocks to watch

 

Companies hosting AGMs: Rio Tinto, AMP, Caltex Australia, APN News & Media, GPT Group.

Investment banks are preparing pitches for Port of Melbourne’s $5 billion privatisation, with the Victorian government expected to interview for sell-side advisory roles within weeks.

Deutsche has a sell recommendation on Wesfarmers Ltd and a 12-month price target of $39 on the shares which are hovering at around $42.77.

JPMorgan has kept its ‘Overweight’ recommendation on Downer EDI after the company reaffirmed its guidance for the 2014 financial year of about $215 million.

 

Currencies

 

The US dollar index rose 0.08 per cent against a basket of currencies. Both the yen and euro were flat against the greenback.

Market participants paid close attention to testimony from Federal Reserve chair Janet Yellen, who said the US economy was still in need of support from the central bank given the "considerable slack" in the labour market. She also cited the housing sector and geopolitical tensions as issues of concern.

Economy Minister Arnaud Montebourg stepped up France's push for a weaker euro on Wednesday, saying political leaders had the right to assess the right level for the currency in a position completely at odds with Germany's.

 

Commodities

 

Two-thirds of commodity hedge funds lost money in the first quarter, extending last year’s dismal run, possibly because they bet against higher crop and energy prices in a rallying market, data from futures broker Newedge and banker HSBC showed.

Nickel prices climbed towards 15-month highs on worries about tightening supplies from Indonesia. Three-month nickel on the London Metal Exchange climbed to a session high of $US18,700 a tonne, near a 15-month high of $US18,715 hit on April 28. Nickel trimmed gains to close 0.8 per cent higher at $US18,650.

Reflecting the changes in Indonesia's trade regulations, analysts at BofA-ML upgraded their average 2015 nickel price forecasts by 33 per cent to $US23,836 a tonne. "We believe nickel can trade to $US25,000/tonne in the coming twelve months," the analysts said.

 

United States

 

US stocks mostly rose on Wednesday as the Federal Reserve signaled it will continue to support the economy, but the Nasdaq fell for a second session on weakness in internet names.

Rupert Murdoch-controlled Twenty-First Century Fox Inc, the film and TV company separated from News Corp last June, reported a 12 per cent rise in quarterly revenue, helped by Super Bowl advertising and cable networks growth.

Of 422 companies in the S&P 500 that had reported earnings through Wednesday morning, 68.2 per cent beat expectations, above the 63 per cent average since 1994, and exceeding the 66 per cent beat rate for the past four quarters, according to Thomson Reuters data. Profits are expected to rise 5 per cent this quarter, down from 6.5 per cent estimated at the start of the year, but above the low of 0.6 per cent in mid-April, according to Thomson Reuters data.

 

Europe

 

European equities inched higher on Wednesday as positive company earnings narrowly outweighed a sharp fall in Fiat shares over scepticism about its new business plan.

Shareholders of UBS have backed the board and management despite opposition due to the bank’s involvement in various scandals, including a global probe into the largely unregulated $US5.3 trillion-a-day foreign exchange market.

Credit Agricole, France’s third-biggest listed bank, rose 6.8 per cent to top the FTSEurofirst 300 leader board after reporting a 30 per cent rise in net income in the first quarter.

 

What happened yesterday

 

Australian equities shed 0.8 per cent on Wednesday amid a torrid day for Asian markets as technology companies were sold off and financials shed further value in the wake of the banks’ earnings season. 

The benchmark S&P/ASX 200 Index declined 45.6 points to 5435.8 points.