Wall Street raced back in the final hour overnight, but for traders in ASX 24 futures, it was a bit too much and as a result, the ASX will start with a modest rise.
The market had been up 54 points just before 7am and eased off as Wall Street was racing to a gain of 4.9% for the session, still well short of the 7% plus slide on Monday.
The Aussie dollar traded around 64.85 just after 7 am Wednesday as the US dollar recovered from Monday’s wobbles. Bond yields rose as confidence emerged.
The yield on the Aussie 10 year government bond leapt 0.18% to 0.79% and parity, for the moment with the US 10 year bond’s yield.
While oil’s rise will help the shares of Woodside, Santos, Oil Search, etc, the slide in gold prices which continued after settlement in New York won’t help the likes of Newcrest, Saracen, St Barbara and Evolution on the ASX today.
In fact, Wall Street’s mad swings – up more than 900 points, then in the red for a short while, then trading sideways before the late rush to an 1100 point fain for the Dow, had the hallmarks of a former feline bounce – a deceased tabby perhaps.
The more circumspect trading on the ASX 24 platform overnight Tuesday came after an equally volatile day here on Tuesday.
Australian shares rebounded on Tuesday after a horror start to the week, but market watchers warn that volatility is likely to persist until there are signs of progress in.
After tumbling close to 4%on the open following Monday’s 7.3% plunge, the benchmark ASX 200 index quickly recouped those losses and more and eventually closed up 179 points, or 3.1%, at 5939.6 for the largest single-day gain in over three years.
But as on Wall Street, the rebound fell far short of the plunge, meaning there’s a big lack of confidence in anything longer than a few minutes for investors at the moment.
At its lows for the session, the index extended its decline from the record highs hit last month to 23%, breaking into a bear market (a 20% fall from the previous peak).
The turnaround was supported by strong gains across banking, mining and technology stocks. Commonwealth Bank shares jumped 6.1% to $73.37, BHP which soared 6.2% cent to $29.25 and CSL which ended 4.4% to $308.97.
The energy sector ended up 3.4%, helped by the rebound in crude oil prices from Monday’s big slide (which also didn’t recoup the earlier losses).
Gains were modest though (beside BHP,’s 6% plus rise. It is the country’s biggest producer). Beach led the way with a rise of nearly 8%, Woodside shares were up 2.4%, Oil Search edged up 1.8% and Santos shares lagged the pack with a gain of just 0.6%.
