Overnight the US was closed, European markets closed in the green, BHP in its London ADR closed over 4% higher. Base metals and Crude Oil held gains, and long-term bond yield continued to climb. US futures also finished their session in the green. Risk on buying in Equities is set to continue.
BHP has delivered a record interim dividend at 1.01USD (1.23 AUD). Coal and Petroleum suffered, but outperformance in Iron Ore and Copper saw the group produce a very strong result. Miners should lead the move higher today following BHP’s strong result and strength in commodities.
NAB gave a quarterly update- unaudited statutory net profit and unaudited cash were $1.7 billion and $1.65 billion which is flat on the previous corresponding period. This is a good sign considering COVID-19 interruptions last year. Like CBA they have significantly reduced frozen home and business loans.
Know that many of these value stocks are almost on the other side of COVID-19 issues, we can look forward to a very accommodative setting to drive growth over the next few years. For this recovery to become reality we cannot see another 3-month strict lockdown as we saw in 2020. But at this stage, the move back into recovery stocks and Value stocks is looking better and better. New on the vaccine front is also helping business and consumer confidence.
With the U.S closed overnight and their futures flat this morning, our market has little leads for its open. We are expected to have a modest rise this morning, edging us closer to the post fall highs at roughly 6900. It is doubtful we push through this level today unless U.S futures have a strong move into the green during our session. Otherwise, it is likely we have a breather today, awaiting overnight trade.
Focus is on commodities at the moment with copper the highest it has been in 8 years, and Oil in 13 months. The miners should do some heavy lifting for our market but will be dampened by a rise in the AUD/USD – a trend that has been in play since the lows a couple of weeks ago.
US market were closed for the Presidents’ Day public holiday. Parts of the US are facing extremely cold weather at the moment, which is both increasing energy demand and disrupting energy supply. US futures are currently strongly higher than their Friday close, so we would expect US equity markets to open higher tonight.