Is our market poised to breach the psychological 6,000 mark with a rebound in iron ore and oil prices and a firmer close on Wall Street overnight?
Traders are tipping a 0.17% gain for the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO) and today's gains should be led by iron ore producers with the Metal Bulletin's iron ore pricing jumping to over $US50 a tonne.
The futures market doesn't think the 6,000 level will be captured today but if the bounce in iron ore and oil is sustained, we could be very close to achieving the milestone.
But the important question is not so much if the S&P/ASX 200 will hit 6,000 points but what if it can't even with a rally in commodity prices? The index has already tried and failed three times to capture that level and technical traders think that is a very bearish indicator, for the short term at least.
However, we won't get much pessimism from shareholders in BHP Billiton Limited (ASX: BHP) and Rio Tinto Limited (ASX RIO) as iron ore jumped to a six-week high of $US50.78 a tonne.
Fortescue Metals Group Limited (ASX: FMG) should be a bigger beneficiary as it is the highest cost producer of significance in Australia but its performance today could be overshadowed by yet another two broker downgrades.
BBY and JPMorgan have both slashed their recommendation on the stock and are urging investors to sell the stock, and shareholders might just take any rally in Fortescue's share price to do just that.
Oil stocks such as Woodside Petroleum Limited (ASX: WPL), Oil Search Limited (ASX: OSH) and Santos Ltd (ASX: STO) should enjoy broad based support as the West Texas Intermediate (WTI) crude oil price jumped 0.5% to $US53.55 a barrel.
Copper and gold producer PanAust Limited (ASX: PNA) will also be in the spotlight this morning after it formally rejected the $1.71 a share takeover offer by its largest shareholder Guangdong Rising Assets Management (GRAM).
However, the miner has left the door open to negotiation. GRAM had made a $2.30 a share initial offer in May.
In other merger and acquisition news, the New South Wales Supreme Court will convene to hear Federation Centres Ltd's (ASX: FDC) takeover bid for Novion Property Group (ASX: NVN).
Insurance and banking group Suncorp Group Ltd (ASX: SUN) could find more buying support today after JPMorgan upgraded the stock to "neutral" from "underweight". Credit Suisse upgraded the stock yesterday and SunCorp jumped 2% to $13.84.
On the flipside, uranium miners Paladin Energy Ltd (ASX: PDN) and Energy Resources of Australia Limited (ASX: ERA) are likely to feel the heat from a Japanese court's decision to stop the restart of two nuclear power plants in the country.
All nuclear facilities were shut down following the Fukushima disaster in 2011.
