Quite day for celebration

Published in the Daily Telegraph, September 2009

The Australian share market is likely to open flat today, led by tosses on Wall Street. The quieter period comes after a week of strong gains in most major markets.

Wall Street closed moderately lower on Friday as the market consolidated after a five-day rally.

After churning in a narrow range between positive and negative territory, the Dow Jones Industrial Average slipped 22.07 points, 0.23 per cent, to finish at 9605.41.

The tech-heavy Nasdaq composite edged down 3.12 points, 0.15 per cent, to 2080.90 and the broad-market Standard & Poor's 500 index shed 1.41 points, 0.14 per cent, to 1042.73.

CommSec chief economist Craig James said the local market would have a reasonably flat start today.

"We had a good week last week with stellar gains not just here in Australia but for most of the developed markets Europe and the US," Mr James said.

"There was a bit of profit-taking in the US on Friday, we had the oil price down and that's going to weigh on energy stocks although gold was up and that would somewhat offset it."

Mr James said investors were also focused on the strong Aussie dollar. It seems reasonably comfortable at above US86c and that's going to mean good things for some companies such as retailers, media companies and imports but for exporters it makes it more challenging," Mr James said.

"It's something that investors are going to focus on much more because there are predictions the Aussie dollar is getting back to above US90c.

"If that doesn't occur over the next couple of months it will certainly occur in 2010."

Wealth Within analyst Dale Gillham believes the market will pause for a while.

"One thing I have learnt about the share market is that it tests your psychology because just when you think the bull-run will continue it stops, catching many unsuspecting investors out," he said.

`'So is the market really bullish? Or is it about to turn?

"I believe it is the latter as there is at least a 90 per cent probability the market will fall in September for at least two weeks."

The Australian share market closed on Friday at an 11-month high after positive news about China's industrial output.

The S&P/ASX200 index closed up 25.3 points, or 0.55 per cent, at 4596.1points, while the broader All Ordinaries index gained 22.8 points, or 0.5 per cent, to 4596.3 points.

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