Wall Street rose on Wednesday, reversing Tuesday’s late slide on suggestions President Trump had changed course on the question of a new stimulus deal before the November 3 elections.
The Dow Jones rose 530.70 points, or 1.91%, to close at 28,303.46, the S&P 500 added 58.49 points, or 1.74%, to end 3,419.44 and the Nasdaq jumped 210.00 points, or 1.88%, to finish the session at 11,364.60.
The gains saw the ASX 200 futures platform trade up 28 points just after 7 am, down from a 33 gain at 6 am. That suggests the ASX will start in the green later this morning after Wednesday’s 74 points, 1.25% gain.
White House Chief of Staff Mark Meadows said he was not optimistic that a comprehensive deal could be reached on further COVID-19 financial aid before the November 3 election and that the Trump administration wanted a more piecemeal approach.
The idea of a smaller, selected approach came in a series of Trump tweets after he called off the talks with the Democrats, a move that sent Wall Street sliding on Tuesday. Those tweets came after he saw the damage his original tweet had caused to Wall Street.
Trump later on Tuesday urged Congress to pass a series of smaller, standalone bills that would include a bailout package for the airline industry battered by the coronavirus pandemic.
That saw airline shares rise sharply on Wednesday – shares in American and United both closed 4.3% higher.
The markets held gains after the Federal Reserve released minutes from its last monetary policy meeting. The minutes showed members of the Open Market Committee dividend on the new relaxed inflation and wages stance after having agreed unanimously in August to the new approach.
The division was over how to implement the new approach rather than to the changed policy itself.
Today’s vice presidential debate will take place in Asian and Australian markets time but probably won’t have much of an impact, although some wags say this is the defacto presidential debate given that Vice President Mike Pence (61) and challenger, Kamala Harris (55) are both significantly younger than President Trump and Joe Biden (who is maintaining his lead in the latest polls).
Oil prices fell nearly 2% on Wednesday despite President Donald Trump’s latest suggestions he might selectively approve new stimulus spending and after US crude stocks rose last week.
In Europe, Brent crude futures fell 66 cents, or 1.6%, to settle at $US41.99 a barrel, while in New York, West Texas Intermediate (WTI) crude lost 72 cents, or 1.8%, to settle at $US39.95 a barrel.
US crude inventories rose 501,000 barrels last week, the US Energy Information Administration said on Wednesday while the market had been looking at a smaller near 300,000 barrel rise.
Meanwhile, Hurricane Delta threatened US oil output in the Gulf of Mexico. The storm has already hit 29% of offshore oil production in the Gulf, which accounts for 17% of America’s total crude output.
And in Norway, a labour union said on Tuesday that it will expand oil strike from October 10 unless a wage deal can be reached. Six offshore oil and gas fields shut down on Monday because of the strike, cutting Norway’s output capacity by 8%. A strike could also see Europe’s biggest oil field closed if the strike is not settled by October 14.
Gold futures fell, dropping back under the important $US1,900 an ounce level.
On Wednesday, Comex December gold dropped $US18, or 0.9%, to settle at $US1,890.80 an ounce.
Comex December silver settled down 2 cents, or 0.1%, to $US23.896 an ounce, but December copper jumped by just on 2.4% to $US3.033 a pound.
