ASX jump on last day of financial year as Wall Street rebounds

Australian shares have clawed back yesterday’s heavy losses, as the turbulent financial year draws to a close.

By 11:30am AEST, the benchmark ASX 200 index had risen by 1.6 per cent to 5,907 points.

Some of the best-performing stocks were Collins Foods (+16.4pc), Boral (+6.3pc) and Qantas (+5.9pc).

Not many stocks are in the red — mainly gold miners like Saracen Mineral (-2.4pc) and Regis Resources (-1.3pc).

The Australian dollar lifted slightly (+0.1pc) to 68.73 US cents.

It follows a rebound on Wall Street as investors put aside concerns about a deeper-than-feared recession and the number of COVID-19 cases surpassing 10 million worldwide.

As the health and economic crises worsen, markets are betting that Congress or the US central bank will inject even more stimulus into the economy.

“The market believes that the [Federal Reserve] has its back,” Sam Stovall, chief investment strategist at CFRA Research in New York, said.

“If things get really bad, the Fed will step in with additional monetary easing and basically reach into their bag of tricks to do whatever they need to support the market.”

In local economic news, the Reserve Bank deputy governor Guy Debelle will give a speech on “The RBA’s policy actions and balance sheet” at 12:30pm AEST.

The RBA has not been purchasing Australian government bonds as part of its quantitative easing program since early May.

The central bank has, so far, been able to keep Australian three-year bond yields at about its target level — a record low 0.25 per cent.

Global rebound

On Wall Street, The Dow Jones index jumped 580 points (or 2.3 per cent) to close at 25,596.

Stepping back from the fiscal cliff

There’s an economic consensus that the Government should borrow and spend at least part of the $60 billion JobKeeper shortfall to prevent a double-dip recession later this year.

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The benchmark S&P 500 and tech-heavy Nasdaq lifted by 1.5

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