The relentless rise in global stock markets has set a positive tone for the Australian stock market this morning. Investors concerned about being caught overweight cash are pushing stock markets higher and we are yet to see any clear signs of this momentum stalling.

The same cannot be said for metals which have shown at least temporary signs of stalled momentum. This has flowed through to the materials sector this morning which proved an early drag on the ASX 200 this morning.

Restructure plans for Italy’s largest bank, UniCredit, have been well received.  This potentially lowers the “wall of worry” for world markets. If UniCredit gets its right issue away it will demonstrate a way forward for recapitalising many of the Italian banks confirming that investors will support well-structured plans that hive off bad debt and cut costs.

Press reports of a rival bid for Tatts, will put focus on Tabcorp. Investors may be concerned about the cost of any sweetening of its bid for Tatts but also be alert to the possibility that Tabcorp may itself be attractive as a target given the rationalisation and search for scale currently underway in the international gaming and wagering industry.