Good morning team, Chris Conway your Head of Research here with your First Look.

SPI futures are currently 23 point up, at 5739 (7:00am, AEDT), despite Wall Street being slightly weaker. A surge in metals prices is setting the commodities heavy Aussie market up for gains.

Copper rose 3% in London, nickel added 2.2% nickel advanced 2% after China’s producer price index lifted at its fastest pace in more than five years. That’s good news because it will help lift prices around the world at a time when central bankers are running out of measures to bolster inflation and there’s increasing pressure to get interest rates off their record lows.

The spot price of iron ore was 2.2% higher overnight, reflecting a surge in both Chinese iron ore and steel futures, and is edging back towards the $US80 a tonne mark.

Key trades

• SPI up 23 pts at 5739
• AUD at US73.64¢
• Dow Jones flat; S&P500 +0.3%; Nasdaq +0.4%
• FTSE100 +0.5%, CAC flat, DAX +0.2%
• Spot gold +0.5% at $US1186.38 an ounce
• Brent oil -1.9% at $US53.90 a barrel
• Iron ore +2.2% at $US79.43 a tonne

What happened overnight?

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