Opening Call: The Australian share market is to open higher.
U.S. stocks settled mixed amid hopes for further U.S. stimulus and disappointing retail sales data for November. The yield on the 10-year Treasury ticked higher to 0.92%. The WSJ Dollar Index dropped recently to 85.37. Hopes for an eventual U.S. relief package pushed both oil and gold prices higher.
Australia’s S&P/ASX 200 closed 0.7% higher, buoyed by surging materials and tech stocks. The benchmark built on a positive lead from the U.S., as ten of the Australian index’s 12 sectors gained. Gold miners led the materials sector higher.
The S&P 500 rose slightly as investors scrutinized lawmakers’ progress toward a stimulus package after new data showed a pullback in retail sales.
The broad U.S. stock index was up 0.2% as of the 4 p.m. close of trading in New York. The Dow Jones Industrial Average dropped about 0.2%, while the tech-heavy Nasdaq Composite added 0.5%.
The retail sales report was the latest indication the economic recovery may be slowing as coronavirus cases surge in the U.S.
Gold futures settled 0.2% higher at $1,859.10, also benefiting from progress toward another fiscal stimulus package from Washington.
Prices for the precious metal then saw volatile moves in electronic trading, with prices slipping after the Federal Reserve said it would maintain asset purchases at current levels, then moving higher as Fed Chair Jerome Powell held his press conference.
Oil futures settled slightly higher, as hopes built for progress toward another economic relief package from Washington and data from the U.S. government revealed a weekly decline in crude inventories.
West Texas Intermediate crude for January delivery edged up 0.4% to settle at $47.82 a barrel on the New York Mercantile Exchange. February Brent crude, the global benchmark, added 0.6% to reach $51.08 a barrel on ICE Futures Europe.
Major currencies were weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.2209 to lows near US$1.2127 and was near US$1.2185 at the US close. The Aussie dollar fell from highs near US75.78 cents to lows near US75.40 cents and was near US75.70 cents at the US close. And the Japanese yen eased from near 103.25 yen per US dollar to JPY103.89 and was near JPY103.50 at the US close.
European share markets closed higher on Wednesday. The pan-European STOXX 600 index rose by 0.8%, and Germany’s Dax index climbed 1.5% following the release of upbeat regional business activity data in December. The UK FTSE index gained 0.9% on Brexit optimism after European Commission President Ursula von der Leyen said, “There is a path to an agreement now.” In London trade, Rio Tinto shares fell 1%, but BHP shares rose 0.2%.
Earlier Wednesday, China’s major stock benchmarks ended mixed. The Shanghai Composite Index was nearly flat, slipping less than 0.01%. The Shenzhen Composite Index lost 0.4%, while the ChiNext Price Index gained 0.1%. Consumption-related stocks broadly rose, while the semiconductor sector was the worst performer.
Hong Kong’s Hang Seng Index added 1.0% as recent laggards, namely tech stocks, logged solid gains.
Japan’s Nikkei Stock Average rose 0.3%, supported by steel and shipping stocks, amid rising coronavirus cases and bearish export data.