The ASX is looking at a sharp partial reversal of Tuesday’s solid 2.4%, 146 point surge when trading resumes this morning after a weak night in Europe and on Wall Street.
Wall Street investors mostly pulled back from stocks, though the Nasdaq extended its record run to a new high, while the safe-haven yen, Swiss franc and gold rose while iron ore slipped lower.
Investors had a weather eye on the start of the latest two meeting of the US Federal Reserve that will culminate early Thursday morning, Sydney time, with a statement that should reaffirm the current ultra-easy monetary policy and support schemes from the world’s pre-eminent central bank.
The tech-heavy Nasdaq moved past early losses to close up 0.33% and briefly cleared 10,000 points for the first time.
The Dow and S&P 500 both slid over the session.
The Dow fell 300.14 points, or 1.09%, to 27,272.3. The S&P 500 lost 25.21 points, or 0.78%, to end at 3,207.18 but the Nasdaq added 29.01 points, or 0.29%, to 9,953.75.
MSCI’s gauge of stocks across the globe fell 0.46%, about 6% below its all-time peak in February. Losses on some major European exchanges topped the 2% mark and the STOXX 600 pan Europe index lost 1`.2%
Just before 7am the ASX 24 futures platform was showing a nasty 94 point slump in the ASX 200 for the start of trading here later this morning. That was up from a 75 point slide at 6 am.
The Aussie dollar also retreated, losing 0.80 to be around at 69.70 US cents in early Asian dealings.
Global iron ore prices lost ground after Monday’s strong surge. the price of 62% Fe iron ore fines delivered to northern China eased $US1.07 a to $US104.60, according to the Metal Bulletin’s Fastmarkets website.
Meanwhile oil prices rose on Tuesday, as confidence in the weekend’s production cuts extension offset growing fears about the continuing rise in coronavirus cases around the world, especially in India, Africa, and South America.
OPEC, Russia and other producers, a group known as OPEC+, on Saturday agreed to extend cuts of 9.7 million barrels per day (BPD) for an extra month until the end of July.
But Saudi Arabia, Kuwait, and the United Arab Emirates said they would not maintain supplemental reductions of 1.18 million barrels of daily supply.
As a result Brent crude rose 38 cents, or 0.9%, to settle at $US41.18 a barrel in Europe, while in the US, West Texas Intermediate crude (WTI) rose 75 cents, or 2%, to end at $US38.94 a barrel.
Against that backdrop, August gold futures on Comex in New York rose $US16.80, or 1%, to settle at $US1,721.90 an ounce, after finishing Monday’s up 1.3%. Comex July silver lost nearly 0.6%, to end at $US17.794 an ounce, following a 2.4% jump the day before.
Comex July copper added another 1.3% to end at $US2.599 a pound.
