Australia's stock market has opened at a modest pace taking on from overnight leads as Wall Street gave up mid-session gains as Federal Reserve chairman Ben Bernanke hinted that further stimulus is required to boost the US economy.

The Dow Jones Industrial Average was the worst performer, slipping 0.2 percent while the broad-based S&P 500 lost 0.1 percent and the NASDAQ finished the session basically unchanged.

The ASX 200 is called to open the session modestly weaker, down 0.2 percent at 4556 following the late session sell off in US indices. The material sector was the best performer in US trade, rising 0.4 percent while healthcare and consumer discretionary managed modest gains of 0.2 percent and 0.1 percent.

Today's Performers: Industrials, Energy

IG Markets strategist Ben Potter said in his morning note to clients that the materials sector will outperform today after a pretty good set of overnight leads. Base metals on the LME were all higher, up between 0.6 percent and 0.9 percent, with aluminium the best. In normal London trade, Rio Tinto and BHP Billiton added 1.2 percent and 0.7 percent respectively. Locally, BHP's ADR is called to open the session 0.6 percent firmer at $43.22.

Energy names may see some support after the US sector finished flat and crude oil futures managed to push higher, adding 0.5 percent to US$99.11/bbl since our 4.30pm close yesterday.

In summary, it looks like the domestic market will open the session modestly lower this morning, although we see upside risk due to the likely outperformance of materials names following solid leads and broad-based US dollar weakness, which helps support US dollar denominated commodity prices. The market is at a very strong support level that has acted as a floor on more than three occasions. After five consecutive falls, we ask ourselves who is left to sell; rather, we see the risk that participants will begin to cover short positions at technical support and bargain hunting will begin to emerge from the long-term oriented, valuation based superannuation funds.

On the economic front, the latest reading into home loans data is due for release at 11.30am, with the market expecting a rise of 2.4 percent to follow last month's decline of 1.5 percent.

Market Movements Chart by IG Markets:

Market

Price at 6:30am AEST

Change Since Australian Market Close

Percentage Change

AUD/USD

1.0716

0.0025

0.24%

ASX (cash)

4556

-11

-0.23%

US DOW (cash)

12085

-44

-0.36%

US S&P (cash)

1286.0

-4

-0.30%

UK FTSE (cash)

5850

2

0.04%

German DAX (cash)

7075

4

0.05%

Japan 225 (cash)

9414

-29

-0.30%

Rio Tinto Plc (London)

41.99

0.51

1.23%

BHP Billiton Plc (London)

23.42

0.16

0.69%

BHP Billiton Ltd. ADR (US) (AUD)

43.22

0.26

0.61%

US Light Crude Oil (Jul)

99.11

0.53

0.54%

Gold (spot)

1543.3

-2.52

-0.16%

Aluminium (London)

2687.00

25

0.94%

Copper (London)

9175.00

79

0.87%

Nickel (London)

22800.00

125

0.55%

Zinc (London)

2288.00

18

0.79%

RBA Cash Rate to be raised by 25bp (Jul) (%)

42.00

0.00

0.00%

IG Markets provides round-the-clock CFD trading on currencies, indices and commodities. The levels quoted in this email are the latest tradeable price for each market. The net change for each market is referenced from the corresponding tradeable level at yesterday's close of the ASX. These levels are specifically tailored for the Australian trader and take into account the 24hr nature of global markets.

Please contact IG Markets if you require market commentary or the latest dealing price.