Overseas markets rallied on Friday after oil prices rose on increased hope that produces may reduce supply to bolster the commodity’s price, says Patersons Securities economist Tony Farnham.

“The US and European markets rallied on Friday thanks to good gains in oil prices as well as on strong US retail sales figures,” Farnham said.

“There was strong buying across the financials, energy and (mining-related) materials sectors – three sectors that our market is strongest in so there’s no surprise why our market is doing really well today.”

He said soothing words from China’s central bank chief that there was no basis for the yuan’s continued depreciation was also adding to Monday’s positive sentiment.

“It is a steadying influence but there is some degree of scepticism,” he said.

“Everyone is waiting to see how the Asian markets react when they open later today.”

At 10.25am (AEDT), Commonwealth Bank was up $1.27, or 1.73 per cent, at $74.60, Westpac had added 50 cents, or 1.78 per cent, to $28.56, ANZ was 64 cents, or 2.89 per cent, better off at $22.82, while National Australia Bank had climbed 53 cents, or 2.2 per cent, to $24.67.

Mining giant Rio Tinto was up $1.33, or 3.29 per cent, at $41.80, while BHP Billiton had risen 84 cents, or 5.57 per cent, to $15.93.

Fortescue Metals was up seven cents, or 4.32 per cent, at $1.69.

As for the major energy players, Woodside Petroleum was up 72 cents, or 2.71 per cent, at $27.33, while Santos had climbed 10 cents, or 3.16 per cent, to $3.26.

But gold miner Newcrest Mining was down 20 cents, or 1.23 per cent, at $16.10 after a decline in gold prices and news its half year profit had more than halved to $US81 million ($A113.82 million).

Freight rail operator Aurizon was also lower after it swung to a half year net loss of $108 million.

Its shares dropped six cents, or 1.56 per cent, to $3.79.

Shares in packaging giant Amcor was up $1.13, or 9.24 per cent, at $13.36 despite its first half profit slipping 4.9 per cent.

And Bendigo and Adelaide Bank’s share price was down five cents to $9.18 despite it announcing a 2.7 per cent rise in first half cash earnings.

At 6.45am AEDT on Monday, the share price index was up 87 points at 4,785.

In local economic news on Monday, the Australian Bureau of Statistics is due to post new motor vehicles sales for January, while the Australian Chamber of Commerce and Industry releases its small business survey.

In equities news, Newcrest, Aurizon, Bendigo and Adelaide Bank, Amcor and Broadspectrum are slated to post half year results.

In Australia, the market on Friday closed more than one per cent lower after the big four banks sagged, taking their lead from global markets.

The benchmark S&P/ASX200 index was down 55.8 points, or 1.16 per cent, at 4765.3 points.

The broader All Ordinaries index was down 54.3 points, or 1.11 per cent, at 4816.6 points.

NEW YORK – Wall Street has gained with reassuring US retail sales and consumer spending data boosting sentiment, while crude prices rallied from more than 12-year lows.

Commerce Department data showing US retail sales excluding vehicles, petrol, building materials and food services increased 0.6 per cent in January also boosted optimism.

“The market has gone from very little chance of recession to pricing in an overwhelming chance of recession despite the data not supporting that,” said Michael Jones, chief investment officer of RiverFront Investment Group in Richmond, Virginia.

“The more numbers you get like retail sales … the more this market can whipsaw people by heading right back up.”

LONDON – Britain’s top share index has ended higher, recording its best one-day percentage gain in more than five months, as banking and commodities-related stocks rebounded from a slump in the previous session.

Aircraft engine-maker Rolls-Royce jumped more than 14 per cent after a well-received update.

The UK mining index surged 8.8 per cent and the oil and gas index gained 5.9 per cent after prices of major industrial metals rose and oil prices rose 10 per cent on prospects for a coordinated production cut, sparked by comments from the energy minister of the United Arab Emirates.

“Strong gains in oil provides a timely boost to what has been a rather gloomy week,” said Craig Erlam, a senior analyst at OANDA. “But I’m not convinced at this stage that this is anything more than a dead cat bounce.”

HONG KONG – Relative calm returned to markets after a hurricane-force week that gave the US dollar/yen its biggest smashing since 2008, but Japan’s Nikkei still fell 5.4 per cent.

The dollar was gradually clawing back some of the four per cent it has lost to the yen this week, settling currency markets.

“All the market has been shattered,” said ABN Amro chief investment officer Didier Duret.

“It has been driven by a lot of speculation. The strength of the yen has created discomfort too, but this is short-term,” he added, saying the Bank of Japan could intervene in FX markets and that data in coming weeks should ease global recession worries.

TEHRAN – Iran claims it has exported its first crude oil shipment to Europe since it reached a landmark nuclear deal with world powers.

WASHINGTON – US retail sales rose modestly in January, evidence that Americans kept shopping despite sharp drops in stock prices.

US consumer spending regained momentum in January as households ramped up purchases of a variety of goods, in a hopeful sign that economic growth was picking up after slowing to a crawl at the end of 2015.

ENERGY

US crude prices have rallied – lifting more than 12 per cent at from Thursday’s more-than-12-year low.

WTI crude lifted $US3.23, or 12.32 per cent, to $US29.38 per barrel after hitting $26.05 a barrel on Thursday.

Brent crude rose $US3.30, or 10.98 per cent, to $US33.36.

Oil prices jumped on prospects for a co-ordinated production cut sparked by comments from the energy minister of OPEC member United Arab Emirates.

PRECIOUS METALS

Gold price has eased after soaring five per cent the previous day, pressured by profit-taking after the biggest rally in more than seven years, but the metal was still set for its best week in four years as investors rushed to safe-haven assets.

“Today, you’ve got a little bit of a corrective pull back. There’s some profit taking going on,” said Bob Haberkorn, senior market strategist at RJO Futures in Chicago.

“Traders are catching their breath and re-evaluating what to do at this stage,” said Haberkorn, who also indicated he expected to see another leg up after a bit more consolidation.

Investors said gold’s prospects for a sustained price rally are better than they have been for years.

“Gold could test $US1,260 or even $US1,300 in the next few weeks, but I wouldn’t be surprised if we also see some profit-taking,” said Commerzbank analyst Carsten Fritsch.

BASE METALS

Copper has gained, along with oil and shares, after upbeat US consumer spending and retail data offered hope of a rebound in economic growth, but metals investors were on edge ahead of the re-opening of Chinese markets next week.

“The mood is slightly better in base metals and oil. The market, to an increasing extent, doubts whether the Fed will hike rates again. Yesterday it was actually pricing in rate cuts,” said Danske Bank analyst Jens Pederson.

Base metals, however, may come under renewed pressure on Monday, when China returns from its week-long New Year break.

“Shanghai stocks may try to play catch-up with European and US stocks, and that normally feeds in to base metals,” one metals trader said.

“But there’s still some short-covering to go.”

ASX stocks to watch Monday, February 15

AMC – AMCOR: Amcor is scheduled to post half year results.

AZJ – AURIZON: Aurizon is slated to post half year results.

BEN – BENDIGO AND ADELAIDE BANK: Bendigo and Adelaide Bank is slated to post half year results.

BRS – BROADSPECTRUM: Broadspectrum is expected to post half year results.

NCM – NEWCREST: Newcrest is expected to post half year results

AAP