Global Fundamental Analysis 10/11/2020

Global Fundamental Analysis 10/11/2020, FP Markets

Opening Call: The Australian share market is to open higher.


U.S. stocks rallied following better-than-expected early data for Pfizer’s covid vaccine candidate. The yield on the 10-year Treasury rose to 0.93%. The WSJ Dollar Index jumped to 87.55. Oil prices logged their largest one-day gain in six months. Gold prices fell, pressured by the strengthening dollar.


Australian Market

Australia’s S&P/ASX 200 index settled at a nine-month high. The S&P/ASX finished up 1.8%, led by resources stocks.


US Market

U.S. stocks jumped to intraday records after progress on a Covid-19 vaccine and Democrat Joe Biden’s electoral victory ushered in a sea change in financial markets, reordering winners and losers.

The Dow Jones Industrial Average climbed 3%. The blue-chip index set its first intraday record since February and came within about 70 points of the 30000 mark before paring some gains. The S&P 500 added 1.2%, also setting an intraday record.

Markets rallied after a vaccine developed by Pfizer and partner BioNTech proved better than expected at protecting people from Covid-19 in a pivotal study, a milestone in the hunt for shots that can stop the global pandemic.



Gold futures suffered their steepest daily drop in more than seven years, as the positive report on a vaccine candidate sent the dollar and government bond yields higher, pressuring bullion.

December gold declined by $97.30, or about 5%, to settle at $1,854.40 an ounce.


Oil Futures

U.S. benchmark oil prices rose 8.5% to settle at $40.29 a barrel, the highest closing price in more than two weeks and the biggest one-day gain in six months also benefiting from news of a possible coronavirus vaccine, and as election results announced so far point to Joe Biden as the winner.



Major currencies were mixed against the US dollar in European and US trade. The Euro fell from highs near US$1.1917 to lows near US$1.1795 and was near US$1.1820 at the US close. The Aussie dollar rose from lows near US72.66 cents to highs near US73.38 cents and was near US72.80 cents at the US close. And the Japanese yen fell from 103.42 yen per US dollar to JPY105.64 and was near JPY105.35 at the US close.


European Markets

European sharemarkets hit an 8-month high on Tuesday on renewed vaccine hopes. Drugmakers Pfizer and BioNTech flagged strong progress in their COVID-19 vaccine (details below). The panEuropean STOXX 600 index gained 4% – the most since March. Travel and leisure stocks jumped 7%. Germany’s Dax index lifted 4.9% -boosted by positive German trade data for September. And the UK FTSE index added 4.7%. In London trade, shares in Rio Tinto rose by 0.3% with BHP up by 2.9%.


Asian Markets

Earlier Monday, stocks in Asia broadly rose as investors responded positively to Joe Biden’s win in the U.S. presidential election amid hopes for less confrontational ties between China and the U.S. and a stronger response to coronavirus from the U.S.

Mainland China’s major stock benchmarks posted strong gains. The Shanghai Composite Index closed 1.9% higher, the Shenzhen Composite Index gained 2.3% and the ChiNext Price Index climbed 3.0%.

Japan’s Nikkei Stock Average rose 2.1%. Insurance stocks and tech-related stocks led the gains.

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