10 Nov 2008

Australian stocks expected to open higher

9:01 am on 10 November 2008

The Australian stock market is expected to open higher on Monday after gains on Wall Street on Friday.

The Reserve Bank of Australia is due to its latest economic forecasts in its quarterly statement on monetary policy on Monday.

CommSec chief equities economist Craig James says investors will be watching closely for any indications of the next move in interest rates by the RBA.

The Reserve Bank last week cut the cash rate by 0.75 percentage points to 5.25% its lowest in five years.

Other economic data this week include the Australian Bureau of Statistics housing finance, labour price index and lending finance data for September.

In New Zealand, the NZX50 index fell 48 points to 2792 on Friday.

In the currency markets: at 8.20am on Monday, the New Zealand dollar was trading at US59.06 cents, 87.49 Australian cents, 37.68 pence, 57.93 yen 0.4640 euro. The Trade Weighted Index was at 59.73.

Overseas markets

The Dow Jones industrial average gained 248.02 points or 2.85% to close at 8,943.81 on Friday. Standard & Poor's 500 index also rose 2.9% after two days of heavy sell-offs.

The rises were despite a big fall in employment. The Labour Department reported the US economy shed 240,000 jobs in October and the unemployment rate shot up to a 14-year high of 6.5%.

It was the 10th consecutive month of job losses.

European stock markets also closed sharply higher. In Paris, the CAC 40 index rose 2.42% to 3,469.12 points and in Frankfurt, the DAX put on 2.59% at 4,938.46 points.

In London, the FTSE 100 index of leading shares gained 2.17% to 4,364.96.