Apple provided the largest boost to the S&P 500 overnight, after its share price surged to a fresh record. (Reuters: Jason Reed)
Australian shares are expected to make gains in early trade after a strong night on Wall Street, boosted by Apple and technology stocks.
Markets at 7:30am (AEST):
- ASX SPI 200 futures +0.2pc, ASX 200 (Thursday close) +0.2pc to 6,119
- AUD: 75.3 US cents, 55.7 British pence, 63.17 Euro cents, 82.39 Japanese yen, $NZ1.08
- US: Dow Jones +0.8pc at 24,740, S&P 500 +0.9pc at 2,723, Nasdaq +0.9pc at 7,405
- Europe: FTSE +0.5pc at 7,701, DAX +0.6pc at 13,023, Euro Stoxx 50 flat at 3,570
- Commodities: Brent crude +0.5pc at $US77.56/barrel, spot gold +0.7pc at $US1,321/ounce
Fuelled by a $US100 billion share buyback plan unveiled last week, Apple surged to its highest price ever, up 1.4 per cent to $US190.04, lifting the S&P 500 higher than any other stock.
The iPhone maker is about 7 per cent away from becoming the first company ever to have a market capitalisation of $US1 trillion.
The S&P and Nasdaq indexes each gained 0.9 per cent. The Dow Jones rose 0.8 per cent, or 197 points, to 24,740.
The worst performing stock was L Brands, the owner of the Victoria’s Secret lingerie and womenswear brand. Its shares dropped 7 per cent after the company said it would post a worse-than-expected quarterly profit, and slower sales during the Easter holiday period.
News Corp’s $US1 billion write-down
Rupert Murdoch’s News Corp reported a larger third-quarter loss due to $US1.16 billion, mainly because it wrote down its investment in Foxtel and Fox Sports, which will merge into a combined company by late June.
News Corp currently owns 100 per cent of Fox Sports, and is the joint owner of Foxtel with Telstra in a 50/50 joint venture.
Under the deal, News Corp will own a 65 per cent stake and Telstra the other 35 per cent.
In extended Wall Street trading, shares in the media company fell 1.7 per cent.
The net loss available to stockholders widened to $US1.13 billion, from $US5 million a year earlier.
However, its total revenue rose 5.8 per cent to $US2.1 billion, beating market estimates of $US1.99 billion.
Its revenue gain was mainly due to its book publishing and digital real estate business, which includes its majority-owned REA Group.
“From the fourth quarter, the combination of digital real estate services and pay TV businesses will account for more than half of our profits and significantly increase recurring subscription-based revenues,” News Corp’s chief executive Robert Thomson told investors.
“At our mastheads, digital audience expanded at a time when premium news has become more important to readers and advertisers.”
Its publications include The Wall Street Journal, The Times and Sunday Times, and The Australian.
Trading on Wall Street was boosted by weaker-than-expected inflation figures released overnight by the Department of Labor.
The headline consumer price index (CPI) rose 0.2 per cent in April, as rising costs for gasoline and rental accommodation were tempered by a moderation in healthcare prices.
Core CPI, which excludes volatile food and energy prices, edged 0.1 per cent higher, slower than the previous two months.
Although the Federal Reserve is expected to lift US interest rates in June, the weaker inflation figure means there is a slightly lower likelihood of aggressive rate hikes for the rest of the year.
Aussie dollar rebound
The Australian dollar staged a rebound, jumping 1 per cent to 75.3 US cents to claw back one week’s worth of losses.
It also lifted 1.2 per cent to 55.7 British pence, and is up slightly to 63.2 Euro cents.
“The US dollar fell and risk appetite got a boost after the weaker-than-expected US CPI print,” ANZ’s head of foreign exchange research, Daniel Been said.
“The Australian dollar outperformed among the G10, partly due to over-stretched positions, and some consolidation today is likely.”
In economic news, the Bureau of Statistics will release its March figures on housing finance — which measures the change in the number of mortgages granted for owner-occupiers.