The Aussie dollar fell to new 17 year lows under 60 US cents after the greenback rose and Wall Street ended the day with gains of 5%-6% after a major move by the US Federal Reserve calmed nervy investors large and small.
Just after 7 am Wednesday the Aussie dollar was trading at just under 60 US cents – around 59.60 US cents, the lowest the currency has been since 2003.
Gold rose for the first time in six sessions, but oil continued falling, as did copper and silver. Iron ore though again showed its resilience with a small rise overnight Tuesday to $US91.20 a tonne for 62% Fe fines delivered to northern China.
Wall Street surged from a shakey start to close higher on news of the new Fed intervention to help companies roll over short-term debt – a move that lessens the fear hundreds of companies could collapse and plunge the economy into a deep recession, if not worse.
The strong finish on Wall Street saw the overnight share price futures market ended with a small loss of 7 points after edging to an 8 point gain just before the close.
The Dow jumped 5.2% or 1,048 points, the S&P 500 surged 6% or 143 points and the Nasdaq ended up 6.23% or 430 points for a solid end to a session that started tentatively
It was a far more assured day’s trading on Wall Street thanks to the Fed’s move and reports President Trump’s administration will reveal $US850 billion ($A1.1 trillion-plus) in new spending and help for consumers and companies, especially in the stricken airline sector.
Seeing the NZ government will inject $NZ600 million into the troubled Air New Zealand, and the funding coming in the US, there are reports Australia will follow today with a package of aid worth more than $700 million in refunds of fees and charges and the dropping of those charges for a period of time heading into the future.
France revealed a support package of 45 to 50 billion euros – recent and some other charges have already been suspended at the order of the Macron government.
Tuesday here saw the ASX enjoy its biggest one-day gain on record a day after the ASX 200 recorded its biggest falls in 20 years and the All Ordinaries Index recorded its biggest fall since the 1987 crash.
The top 200 companies closed 5.8% at 5923.4 points, thanks to a surge of nearly 150 points in the final hour of trade – nearly reversing the 100 point slump on Monday after the 4 pm-close.
The All Ords was up 5.43% which was also the biggest single-day gain on record.
The financial sector added the most points, with a 9.2% gain, the biggest on record, as the big retail banks made huge gains. Commonwealth Bank shares soared 13.3% to $67.64, ANZ Bank surged 11.8% to $18.40, Westpac jumped 8% and NAB rose 6.8 %to $17.21. Shares in market operator ASX leapt 12.6%.
The materials sector also had the biggest one-day gains on record, rising 9%, with gold stocks like Northern Star and Regis Resources up an astonishing 19.7% and 18.6% respectively. BHP shares were up 12% to $28.31, Fortescue jumped 10.8% to $10.69 and Rio Tinto shares were up 6.9% to $83.
The three supermarket groups though saw major, unexplained gains – the gains for Metcash (26.9%) and Woolies (9.7%) were the strongest since both companies listed on the exchange in the 1990s.
Woolworths shares closed at $39.85. Yesterday’s rise was the strongest since 2016. Metcash’s swing has been astounding. The shares hit 14-month low last Thursday at $2.35, but surged yesterday, driving higher through the session to top the $3 mark late in the day.
Coles shares closed up 8.4% at a new all-time high of $17.72. Coles shares also jumped 8.7% last Friday.
