The Australian share market looks set to open higher after upbeat sentiment over tax reform legislation passing the Senate pushes Wall Street’s Dow Jones through 24,000 points for the first time.
At 0700 AEDT on Friday, the share price futures index was up 19 points, or 0.32 per cent, at 6,005.
In the US, Wall Street indexes have rallied on increasing indications the Republican party’s push for a US tax overhaul may get enough support to pass.
Republican US Senator John McCain said he would back the tax bill, citing a boost to the economy, even though it was ‘far from perfect’.
Investors cheered McCain’s support as his vote against Republican Obamacare repeal efforts was key to its collapse earlier this year.
A reduction in the US corporate tax rate to 25 per cent could boost S&P 500 earnings by 6.5 per cent, UBS US equity strategist Keith Parker estimated.
The Dow Jones Industrial Average was up 1.22 per cent – at 24,231.87, at 3.23 pm Thursday EST (0723 Friday AEDT).
The S&P 500 had gained 0.62 per cent and the Nasdaq Composite had added 0.57 per cent.
Locally, in economic news on Friday, property analytics business CoreLogic is slated to release its capital city house prices survey for November and the Ai Group’s performance of manufacturing (PMI) index for November is also due out.
In equities news, Premier Investments has its annual general meeting.
Meanwhile, the Association of Superannuation Funds of Australia’s annual conference wraps up.
The Australian market on Thursday closed lower following the shock announcement of a royal commission into the finance industry, with banks and insurers hit by the news – Commonwealth Bank and ANZ recording the biggest falls.
The benchmark S&P/ASX200 index fell 41.2 points, or 0.69 per cent, to 5,969.9 points
The broader All Ordinaries index closed down 38.9 points, or 0.64 per cent, at 6,057.2 points.
Meanwhile, the Australian dollar is down against the greenback despite the US dollar index falling 0.1 per cent overnight.
The local currency was trading at 75.65 US cents at 0700 AEDT on Friday, from 75.90 on Thursday.
CURRENCY SNAPSHOT AT 0700 AEDT:
One Australian dollar buys:
* 75.65 US cents, from 75.90 on Thursday
* 85.14 Japanese yen, from 85.099 yen
* 63.60 euro cents, from 63.97 euro cents
* 55.94 British pence, from 56.36 pence
* 110.71 NZ cents, from 110.87 cents
The spot price of gold in Sydney at 0700 AEDT was $US1,274.675 per fine ounce, from $US1,283.80 per fine ounce on Thursday.
BOND SNAPSHOT AT 0700 AEDT:
* CGS 4.50 per cent April 2020, 1.8155pct, unchanged
* CGS 4.75pct April 2027, 2.4591pct, unchanged
Sydney Futures Exchange prices:
* December 2017 10-year bond futures contract at 97.455 (implying a yield of 2.545pct), from 97.485 (implying a yield of 2.515pct) on Thursday
* December 2017 3-year bond futures contract at 98.06 (1.94pct), from 98.08 (1.92pct).
(*Bond market closes taken at 1630 AEDT previous local session; currency closes taken from 1700 AEDT previous local session)