AUD hits 15 month high, ASX Futures up as gold makes new all-time high

By Trevor Hoey. Published at Jul 28, 2020, in Market Wrap

The S&P/ASX 200 index (XJO) defied Friday’s negative leads from overseas to post a gain of 20 points or 0.3% on Monday.

As the index edged up to its close of 6044 points, it was mainly gold miners riding on the back of a record gold price that provided the boost.

Australian producers are benefiting from favourable foreign exchange rates, and good gains were made by majors Newcrest Mining (ASX: NCM) (+5%), Northern Star (ASX: NST) (+4%) and Saracen Minerals (ASX: SAR) (+5.2%).

This support is likely to continue on Tuesday as the gold price blitzed the previous all-time intraday record of US$1917 per ounce, gaining more than 2% or US$44 per ounce to hit US$1941.90 (A$2720) per ounce.

US markets also performed strongly, possibly nullifying yesterday’s mixed moves in the Asia-Pacific and European regions.

The ASX SPI200 futures index suggests we are in for a positive day, up 26 points to 6034 points.

24 hours

Markets were mixed in the Asia-Pacific region with the Shanghai Composite delivering a similar proportionate gain to the XJO, increasing nearly 0.3% to close at 3205 points.

Negative sentiment prevailed in Hong Kong with the Hang Seng falling 102 points to 24,603 points.

The Nikkei 225 came off nearly 0.2% or 35 points to close at 22,715 points.

In the UK, the FTSE 100 retraced late in the day to finish down 19 points or 0.3% at 6105 points.

In mainland Europe the DAX was flat, finishing close to its previous day’s close of 20,838 points, while the CAC 40 shed 0.3% to close at 4939 points.

The NASDAQ was back in full force in the US, surging 173 points or 1.7% to close at 10,536 points, now just 230 points shy of last Monday’s all-time record close.

Shares in Moderna (NASDAQ: MRNA) soared 9% after the company was granted an additional US$472 million from the US government's Biomedical Advanced Research and Development Authority (BARDA).

This funding will support a phase 3 program for Moderna's COVID-19 mRNA vaccine candidate mRNA-1273, and it follows a previous grant of US$483 million from BARDA.

The Dow gained 0.4% or 115 points to close at 26,584 points, while the S&P 500 rallied 0.7% to 3239 points.

Obviously, it was gold that stole the headlines on the commodities front, but there was a late surge in the Brent Crude Oil Continuous Contract as it increased more than 2% from about US$43 per barrel to US$44 per barrel.

Iron ore gave up some of its recent gains, falling 1.6% to US$107.70 per tonne.

Amongst the base metals, copper was relatively flat and zinc increased 1% to push back above US$1.00 per pound.

Nickel continued its strong performance, closing in on US$6.20 per pound, up US$0.45 per pound in the last month, and now sitting at a near six month high.

However, lead was the standout performer as it gained 2.8% to push beyond US$0.83 per pound.

The Australian dollar continued to make ground against the US dollar, and it is now fetching 71.5 US cents, up approximately 25% since mid-March.

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