Our market is heading for a very solid opening this morning after global markets at last got on the same wavelength on a Monday and rose in unison.
At various times in the past few weeks the Australian market has been out of synch with the rest of the world – rising on a Monday (or falling) only for markets in Europe and the US to move in a different direction.
But on the part holiday Monday, the local market jumped nearly 2% in thin trading, leaving it a bit exposed.
But that wasn’t to be and markets in Europe and the US followed with very solid gains as they concluded the chances of a US rate rise had passed for 2015 in the wake of the weak jobs report for September.
The local market will open more than 60 points higher this morning as a result off the offshore optimism, according to overnight trading on the share futures contract.
Comex gold lost $US2 an ounce in New York as the big 2% surge last Friday petered out. US oil futures though rose nearly 1.7% to more than $US46.30 a barrel.
The Aussie dollar jumped above 71 US cents during trading overnight, then retreated, and it wouldn’t surprise to see another rise, once we know the Reserve Bank board’s interest rate decision at 2.30 today.
On Wall Street, the Dow had its best day for around a month, ending up more than 300 points and looking frisky.
The S&P 500 was up for a fifth day in a row – its best run so far this year.
Rising oil prices boosted energy stocks (but ignored price cuts by the Saudis who are trying to move its continuing high levels of production).
Investors around the world are now betting that the Federal Reserve will delay raising interest rates until 2016.
The Dow rose 304.06 points, or 1.85%, to 16,776.43, the S&P 500 surged 35.61 points, or 1.82%, to 1,986.97 and the Nasdaq Composite added 73.49 points, or 1.56%, to 4,781.26.
The gains overnight – Hong Kong and Tokyo were up around 1.6% each and European markets added nearly 3% on the day, according to the Stoxx 600 index, followed the previous week’s mixed performance thanks mostly to the sell off last Tuesday.
Eurozone shares end down 0.8%, Japanese shares fell 0.9% and Chinese shares were down 1.3% ahead of the start of a week long break last Thursday. But Australian shares rose 0.2% and US share were up 1%.
A resources-led rally pushed the Australian sharemarket nearly 2% higher yesterday, thanks in part of as thin trade volumes amplified a big jump in energy and mining stocks (especially gold after its big rise on Friday night after the weak US jobs report for September).
At the market close yesterday, the ASX200 index was up 98.5 points, or 1.95%, to 5150.5, while the All Ordinaries index added 94.9 points, or 1.86%, to 5184.1.
Trading volumes were down 60% from a normal non holiday trading day, with business in NSW, the ACT, Queensland and South Australia all having a public holiday.
