ASX 200 poised to crack 6,000 points - ASX Futures up 73 points

By Trevor Hoey. Published at Jun 4, 2020, in Market Wrap

The S&P/ASX 200 (XJO) stacked on more than 100 points or 1.8% on Wednesday to close at 5941 points, a three month high.

Given the strength in global markets overnight it would appear that we are in for another strong day with the SPI200 Futures index up 73 points this morning to 5999 points.

The negative GDP data released yesterday was already well flagged, and despite its recession implications investors are definitely taking a look through approach, seemingly making assumptions that our economy can recover quickly and strongly as it shakes off the effects of COVID-19.

One of the key factors over the last few days supporting confidence was the imminent release of a stimulus package to kick-start the construction industry.

The Prime Minister has just fronted the media, and the proposed packages that have been discussed in recent days have now been confirmed, another positive catalyst ahead of trading today.

However, in recent days the share prices of stocks leveraged to an increase in building activity have soared, suggesting much of the upside is already factored in.

Despite the positive outlook, the market does appear to be one that has run too hard, too soon and a near-term retracement wouldn’t surprise.

24 hours

Asian markets also traded strongly yesterday with the Nikkei 225 up 1.3% to 22,613 points, and the Hang Seng gaining 330 points to close at 24,325 points.

This is the first time the Nikkei 225 has passed 22,500 points since February, and it is now only 1500 points off its 12 month high.

Despite mass rioting on the streets of London and mainland European cities, the markets were extremely robust, outperforming the gains made in the Asia-Pacific region.

FTSE 100 was up 2.6% or 162 points to 6,382 points.

The DAX surged 3.9% or 466 points, closing at 12,487 points, a level it hasn’t traded at for more than three months.

The CAC 40 gained 163 points or 3.4% to close at 5022 points, a three month high.

US markets continued their strong run with the Dow up 2% or 527 points to 26,269 points.

The S&P 500 gained 1.3% to close at 3122 points.

The NASDAQ gained 0.8% or 74 points to close at 9682 points.

Just prior to the session closing, the index broke through the 9700 point mark for the first time since the coronavirus downturn, and unbelievably it is now only 156 points shy of its all-time high.

With all the planets aligning there was no other way but down for the CBOE Volatility Index, and it is now hovering just above 25 points, once again nearly back to pre-coronavirus levels.

Gold remained out of favour as its safe haven status was no longer sought after, and the precious metal has now fallen by approximately US$50 per ounce to US$1700 per ounce, a level where support has consistently re-emerged when there have been retracements over the last few months.

Oil hit US$40 per barrel for the first time in three months.

Having pushed up above $100 per tonne again, iron ore is sitting tight around that mark.

Base metals were relatively flat overnight, but zinc is edging closer to the high of about US$0.92 per pound that it struck on May 20.

To eclipse that point would be significant as that represented an 11 week high.

The Australian dollar continued its strong surge and it is now trading less than a cent below US$0.70, taking it back to January levels.

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

Publishers Notice

The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.

Australian ASX Small Cap stocks | Why Finfeed.com is Australia’s leading small cap publication

Founded seven years ago, Finfeed.com is Australia’s leading and longest standing website for investor and finance news, education and expert opinion.

Published by StocksDigital, Finfeed was created to report daily on the comings and goings of ASX listed stocks in the small cap market.

As the first digital publication dedicated specifically to this space, Finfeed soon became the most trusted publication in the market, quickly garnering over two million page views – a number that continues to rise.

Finfeed.com provides its readers with informative articles that tackle the latest in market moving #ASX small cap news, plus exclusive content you won’t find anywhere else. It is aimed at those with an interest in investing, market education, company performance, start-ups and much more.

Finfeed.com is the only media organisation operating under the strength of a Financial Services License and is backed by leading journalists and analysts all with brands of their own.

The website aims to inform, educate and entertain with content that drills down into the heart of financial matters.

Finfeed is a leading source of investor and market information, with everything investors need to know about how to invest written in a way that anyone can understand. 

Over the years, the website has expanded beyond exclusively reporting on small caps, to profile Australia’s leading ASX listed small, mid and large caps as well as some of the country’s most successful CEOs and business leaders to find out what makes them tick.

Every day you will find fresh content covering:

Fast Facts

Over 4,000 articles published

Over 2.3 Million Page Views and counting

Over 10,000 followers on social media

Subscriber list growing by 2% monthly

Thanks for subscribing!

X