Australia 200 has opened steadily this morning following a 0.4% rally in US SPX 500 after the Thanksgiving holiday. This franked the rise in the local market since last Wednesday.

However, a key aspect of stock market trading today looks like being whether investors are willing to keep chasing mining stocks after further steep gains in metal prices.

Stock markets have been caught out by metal prices this year. Base metals have defied the gravitational pull many anticipated, leaving mining stocks looking cheap. However, the ongoing blow out in spot prices for iron ore and copper over recent days seems to be moving in advance of improvements in underlying demand and could set up a situation where the stock market adopts a wait and see attitude.

It’s not unusual for markets to have to deal with a flurry of statements leading into an OPEC meeting. However, the sharp drop in oil prices on Friday indicates the market has begun to price for failure at this week’s meeting. The weekend statement by Saudi Oil Minister Khalid al-Falih, may have been laying the ground work for failure to reach agreement on a meaningful cut in production.

Tabcorp shares have been under pressure since announcing a merger proposal with Tatts. However, this is likely to change following reports in the UK media that Ladbrokes may be preparing a bid for Tabcorp itself. This possibility is consistent with the global rationalisation in wagering stocks given the benefits of scale in an online world. At this stage it is by no means clear which companies will emerge as survivors in this process.