Australian shares drifted up 0.1 % in early trading

Monday, 18 April 2011 07:01

Australian shares drifted up 0.1 % in early trading but weaker commodity held back any serious gains.

The benchmark S&P/ASX 200 index climbed 4.3 points to 4,856.40 by 0220 GMT. The index fell 0.7 % on Friday to a two week closing low.

Traders said China's move to raise its bank reserve ratio for the fourth time this year to tame inflation also hurt investor mood. China is Australia's top trading partner and tightening is seen dampening demand.  

This coming week should be very interesting for the commodities and FX market, there has been a considerable cooling off period in in the global commodity prices and off the back of that the AUS $ has been off its highs.

China is definately looking to cool their economy and this will have direct impact on commodity prices and the AUS $.