Global Fundamental Analysis 25/03/2020

OPENING CALL: The Australian share market is expected to open higher. The SPI200 futures contract expected to open 278 points up.


The delay of the Tokyo Olympics to 2021 deals a fresh blow to the weakening Japanese economy but should ensure Shinzo Abe wins a farewell moment in the international spotlight as prime minister.


The head of CVS Health told a Wall Street Journal Health Forum that the pharmacy operator’s supply of pharmaceuticals remains steady even as the coronavirus pandemic roils manufacturing and distribution markets globally.


Overnight Summary




Australian Market

Australian shares closed 4.2% higher after the energy sector led a late surge. The benchmark S&P/ASX 200 index gained nearly 100 points in the last 20 minutes of the session to close 189.7 points higher at 4735.7.

Beaten-down energy stocks led a rally from the previous day’s sell off, rising 7.6% after crude prices steadied overnight and Australia’s parliament approved A$84 billion in economic stimulus. Property trusts, tech and financials also gained strongly but, despite a third gain of more than 4% in eight sessions, the ASX 200 is still at levels not seen since early 2016.


US Market

U.S. stocks rallied intraday on signs that lawmakers and the Trump administration were nearing a deal on a giant stimulus package aimed at limiting the economic fallout of the coronavirus pandemic.

The Dow Jones Industrial Average gained 1,403 points, or 7.5%, in afternoon trading. It had been up nearly 10% earlier, before paring gains. The S&P 500 climbed 6.1%, while the Nasdaq Composite rose 5.1%.

A string of emergency measures by the Federal Reserve to support credit markets and ensure funding for American businesses and homeowners has also helped alleviate some of the most pressing concerns among investors.



Gold prices posted their largest daily percentage surge in more than a decade as the precious metal extended its rally in the wake of the closure of gold mining operations and moves by the Federal Reserve to address the coronavirus crisis.
Gold for April delivery on Comex rose $93.20, or about 6%, to settle at $1,660.80 an ounce. The yellow metal booked its largest one-day dollar gain based on records dating back to November 1984, and biggest daily percentage rise since March 2009, according to Dow Jones Market Data.


Oil Futures

Oil futures ended higher, extending their gain to a second straight session, a day after the Federal Reserve unveiled a historic round of monetary stimulus and investors
remained upbeat about prospects for a Congressional approval of a massive fiscal stimulus package.

West Texas Intermediate crude for May delivery climbed by 65 cents, or 2.8%, to settle at $24.01 a barrel on the New York Mercantile Exchange. May Brent crude, the global benchmark, rose 12 cents, or 0.4%, to $27.15 a barrel on ICE Futures Europe.



The WSJ Dollar Index, which tracks the currency against a basket of others, recently fell 0.6%.  On Monday, the gauge hit its highest closing level since 2002. Currencies including the euro, U.K. pound and Japanese yen strengthened against the dollar.


European Markets

European stocks gained as Wall Street rallies on hopes that U.S. leaders will approve a fiscal stimulus package to shield the economy from coronavirus.
The Stoxx Europe 600 rose 8.4%, the FTSE 100 added 9.1%, the DAX advanced 10.9% and the CAC-40 increased 8.4%.
U.S. House Speaker Nancy Pelosi said an agreement on coronavirus rescue deal could be reached shortly. Market sentiment was also bolstered by a slowdown in coronavirus deaths and infections in Italy along with a pledge by G7 finance ministers and central bank governors to do whatever it takes to combat the coronavirus crisis.


Asian Markets

Japan’s Nikkei Stock Average rose 7.1% to close at 18092.35, posting its biggest percentage gain since February 2016, driven by gains in technology and electronics stocks. SoftBank Group soared another 19% after having risen 19% on Monday following news of its asset sale and share buyback plan. Tokyo Electron surged 18%.

Singapore shares climbed after the Fed unveiled a major stimulus package that included unlimited purchases of Treasurys and mortgage-backed securities. The FTSE Straits Times Index closed up 5.8% at 2362.05. REITs and property developers were among the best performersand bank stocks were also higher.

Hong Kong shares ended the session sharply higher, as most Asian markets bounced back from Monday’s losses following the Fed’s additional assistance to the U.S. economy. The benchmark Hang Seng Index rose 4.5% to settle at 22663.49, reversing the three-year-low closing on Monday. All index constituents rebounded, with auto stocks and telecom carriers leading gains.

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Source - database | Page ID - 22053

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