Gold price continues slide, S&P 500 just shy of record high, futures up 42 points
The S&P/ASX 200 index (XJO) struggled on Wednesday, but a late surge of around 30 points saw it finish at 6132 points, down only seven points on the day.
A steep fall in the gold price resulted in substantial downward pressure from that sector.
With the precious metal having fallen below US$1900 per ounce overnight before recovering to about US$1920 per ounce, this sector could continue to place a drag on our broader market.
What appears more likely today though is that strong performances across global equities markets will offset ructions in the mining sector where base metals also took a hit.
The ASX SPI200 futures index is up 42 points to 6130 points, suggesting that investors will focus more on the big picture.
There were mixed performances across the Asia-Pacific markets yesterday with the Hang Seng surging 353 points or 1.4% to close at 25,244 points, while the Shanghai Composite fell 0.6% or 21 points, closing at 3319 points.
The Nikkei 225 gained 93 points to close at 22,803 points.
The mood in Europe remained decidedly positive with the FTSE 100 surging more than 2% or 125 points to 6280 points.
In mainland Europe, the DAX put on 111 points, closing at 13,058 points, while the CAC 40 recorded a similar percentage gain as it increased 45 points to 5073 points.
The positive sentiment flowed over to US markets, and it is worth noting the performance of the S&P 500 which increased 1.4% to 3380 points, just six points shy of its all-time record closing price.
To put this in perspective, the Dow gained 1% to close at 27,976 points, but it is still nearly 1600 points shy of its all-time high.
The NASDAQ returned to form with a gain of 2.1% or 229 points, once again pushing above the 11,000 point mark, bringing it within about 100 points of the record high struck earlier in the month.
Given the US remains heavily in the grip of COVID-19, while also facing a hangover of decades of financial pain, this degree of positive sentiment seems absurd.
Aside from gold, oil was one of the commodities in the spotlight, increasing from about US$44.50 per barrel to nearly US$45.50 per barrel.
Iron ore’s strong rally eased a little, gaining just 0.3% to US$121.50 per tonne.
All base metals trended lower with copper at the forefront of the retracement as it slipped for the second consecutive day to finish at US$2.90 per pound.
The Australian dollar has strengthened slightly, sitting just above US$0.715.