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US job figures likely to drive ASX higher

AAP logoAAP 8/01/2017 Christopher Talbot

Encouraging employment figures out of the United States are likely to drive share prices higher when the Australian Share market opens on Monday.

CommSec's chief economist Craig James said there were also some gains in the US and Europe that will set up a positive day for the ASX on Monday.

"The Dow Jones is creeping ever closer to 20,000, and with encouraging employment figures out of the United States, the US econonomy is going to have a bit of momentum through the year and that will help profits and therefore drive share prices, " he said.

"Futures is pointing to a gain of 10 points, and I think that's probably pretty reasonable. We might see gains of a little bit more than than that, but we we do have mixed conditions in the resources sector."

In terms of commodities, oil and base metal prices are up and gold and coal down.

"A little bit more mixed in terms of the outlook for resources, but for the broader markets it looks like it's generally positive," Mr James said.

On Friday, the ASX 200 managed to edge higher by 0.04 per cent or 2.3 points to 5755.6.

All eyes are on the US as Donald Trump moves closer to his inauguration on January 20.

"The topic at the moment is Donald Trump and what he's likely to do once he gets into power but we're still in a 'wait and see mode'," Mr James said.

Since the US election, Australian equities have improved by 14 per cent while American stocks have gained 11 per cent, Commsec said on Friday..

This week, economic releases ramp up with the focus on November retail spending data locally, and offshore, data on Chinese inflation and trade will receive attention.

"The United States has a few indicators as well, together with a speech by US Federal Reserve chair Janet Yellen on Thursday," Mr James said.

Australian investors will also be poised for building approvals coming out on Monday.

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