Our market lost ground on the open, following losses on the major US indices that averaged around 2%, although our market was not expected to fall by that amount as some was factored in yesterday. This did not last however, as the lows were rejected quickly and the market rallied for most of the day, fading a little in the last hour. Inflation data released seems to be the most likely catalyst for the rally and the US futures have been stronger in the night session – up 0.4% at the time of writing. Speculation for a rate reduction on Melbourne Cup day has strengthened with the data release. At day’s end a small gain of 0.3% was posted for the XJO, closing 14.6 points higher. Sectors were mostly positive with none startling except for Gold which closed up 3.2% after a solid night for many of the metals commodities. Nothing much has changed from the last two trading weeks – still in a consolidation pattern on low volume.

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