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

Australian shares are likely to recoup some of yesterday’s heavy losses on Tuesday morning, as the turbulent financial year draws to a close.

Market snapshot at 7:50am (AEDT):

  • ASX SPI futures +1.2pc at 5,874 points, ASX 200 (Monday’s close) -1.5pc at 5,815
  • AUD: 68.64 US cents, 55.78 British pence, 61.06 Euro cents, 73.83 Japanese yen, 4.85 Chinese yuan, $NZ1.069
  • US: Dow Jones +2.3pc at 25,596, S&P 500 +1.5pc at 3,053, Nasdaq +1.2pc at 9,874
  • Europe: UK (FTSE): +1.1pc at 6,226, Germany (DAX) +1.2pc at 12,232, Euro Stoxx 50 +0.9pc at 3,232
  • Oil: WTI crude (August) +3.1pc at $US39.70, Brent crude (August) +1.6pc at $US41.68/barrel
  • Spot gold flat at $US1,770.81/ounce
  • Iron ore -3.4pc at $US99.85/tonne

    ASX futures were up 71 points (or 1.2 per cent) by 7:15am AEST.

    The Australian dollar was steady at 68.6 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

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