OPENING CALL: The Australian share market is to open higher.
U.S. stocks rose after getting a boost from the slowing spread of coronavirus in the U.S. and upbeat manufacturing data. The yield on the benchmark 10-year U.S. Treasury ticked up to 0.558%, from 0.536% Friday. The WSJ Dollar Index rose almost 0.2% to 88.84.
Oil prices rose as the same news that propelled stocks gave hopes for climbing demand. Gold prices settled slightly higher, but gains were capped by the dollar’s climb.
Australian shares closed essentially flat at 5926.1 as banking and retail stocks dragged amid worries over the impact of the country’s latest coronavirus restrictions.
The benchmark S&P/ASX 200 index lost 1.7 points, or less than 0.1%, despite strength from the materials and energy sectors.
U.S. stocks rose, lifted by a surge in technology stocks like Apple and Microsoft, as well as signs that the rate of new coronavirus infections could be slowing.
The Dow Jones Industrial Average gained 236 points, or 0.9%, as of the close of trading in New York, getting August off to a strong start. The index climbed 2.4% in July. Trading volumes are expected to slide in the coming weeks with the onset of the summer vacation season, leading to a potential increase in volatility.
Gold prices eked out a slight gain, but enough to finish at a fresh record Monday, with a bounce higher in the U.S. dollar muting some of the rallies that had taken bullion temporarily to a psychologically significant level near $2,000.
The dollar bounce has certainly taken the edge off gold, although not before it took another run at $2,000 early in the session,” wrote Craig Erlam, senior market analyst at Oanda in a daily research report. A stronger dollar can make assets priced in the currency more expensive of overseas buyers.
December gold rose 40 cents, or less than 0.1%, to settle at $1,986.30 an ounce, after touching a fresh intraday peak at 2,009.50, according to FactSet data.
U.S. benchmark oil prices settled 1.8% higher at $41.01 a barrel on hopes demand will continue to recover after the daily toll of new coronavirus cases in the U.S. fell to the lowest daily total in nearly a month.
The data, along with an improvement in broader-market risk appetite, was more than enough to offset the bearish sentiment from OPEC and Russia kicking off a move to increase in crude output.
Major currencies were weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.1780 to lows near US$1.1700 and was near US$1.1760 at the US close. The Aussie dollar fell from highs near US71.45 cents to lows near US70.75 cents and was near US71.20 cents at the US close.
The Japanese yen eased from 105.55 yen per US dollar to near JPY106.45 and was near JPY106.00 at the US close.
European sharemarkets rose on Monday in response to positive manufacturing activity. According to the latest purchasing managers’survey, German manufacturing expanded in July for the first time since 2018. There were also positive manufacturing readings across the eurozone, in China, the UK, and the US. Auto stocks rose by 3.8%. But shares in HSBC fell 2.9% after reporting that half-yearly earnings halved. The pan-European STOXX 600 rose by 2.1%. The German Dax index gained 2.7%. The UK FTSE index rose by 2.3%. In London trade, shares in Rio Tinto rose by 4.1% and shares in BHP rose by 2.6%.
Earlier Monday, Chinese stocks ended the session higher, as the market extended a broad recovery trend since late July. The benchmark Shanghai Composite Index grew 1.8% to settle at 3367.97, while the Shenzhen Composite Index added 2.6% to 2315.44.
The ChiNext Price Index, which measures the performance of startups and emerging industries, gained 2.6% to 2868.88.