NASDAQ leads recovery in US, SPI Futures up 77 points
As the Australian sharemarket took its lead from overseas trends, the S&P/ASX 200 index (XJO) plunged 129 points or 2.2% to close at 5879 points on Wednesday.
It should be a different story today with US markets staging a significant turnaround last night after three consecutive days of losses, and this is reflected in the ASX SPI200 futures index which is up 77 points to 5937 points.
Just as Microsoft and Apple have been behind the rebound in the US, a recovery from yesterday’s market rout in Australia is likely to be led by heavily sold down tech and communications stocks.
On the political front, President Trump was criticised for playing down the severity of the coronavirus even prior to the pandemic making inroads in the US, but in true Trump style he brushed that off as strategically sound because avoiding panic was in the country’s best interest.
It could be argued that the citizens of the US would have preferred some ‘’early warning panic’’ if being better prepared would have helped in stemming a death toll that is now approaching 200,000.
Overseas markets rally as one
Looking at the numbers, the NASDAQ led the way in the US with a gain of 293 points or 2.7% as it closed at 11,141 points.
The S&P 500 also rallied strongly, up 2% to 3399 points, while the Dow gained 440 points or 1.6% to close at 27,940 points.
European markets rebounded as Germany led the way with the DAX gaining more than 2% or 269 points to close at 13,237 points.
The CAC 40 was up 1.4% to 5043 points.
The FTSE 100 started strongly, closing in on 6000 points early in the session, and after a brief retracement the index rallied in the afternoon to close at 6012 points, up 82 points or 1.4%.
On the commodities front, the Brent Crude Oil Continuous Contract recovered from sub-US$40 per barrel levels to close at US$40.79 per barrel after briefly touching US$41.00 per barrel.
Gold pushed above US$1950 per ounce for the first time since the start of the month, closing at US$1955 per ounce.
The iron ore price was one of the few disappointments as it shed 2% to close at US$126.50 per tonne.
There was little movement in base metal prices, but copper put in the best performance as it finished just shy of the recent long-term high of US$3.07 per pound after retracing to US$3.03 per pound on Tuesday.