Saturday, April 21, 2018
Business

ASX to open higher on tech-driven Wall Street rally

Related Story: Trade surplus hit by iron ore export slump

The technology sector has continued to bounce back and was a significant driver of Wall Street's overnight gains.

Market snapshot at 8:35am (AEDT):

  • ASX SPI 200 futures +0.4pc at 6,004, ASX 200 (Thursday's close) +0.5pc at 5,978
  • AUD: 75.1 US cents, 55.74 British pence, 63.79 Euro cents, 84.95 Japanese yen, $NZ1.10
  • US: Dow Jones +0.3pc at 24,211, S&P 500 +0.3pc at 2,637, Nasdaq +0.5pc at 6,813
  • Europe: FTSE -0.4pc at 7,321, DAX +0.4pc at 13,045, Euro Stoxx 50 +0.2pc at 3,570
  • Commodities: Brent crude +1.5pc at $US62.11/barrel, spot gold -1.3pc at $US1,247.20/ounce, iron ore -5.3pc at $US65.70/tonne

Tech boosts Wall Street

Google and Facebook shares have gained 1.4 and 1.7 per cent respectively.

Tech has been the best performing US sector this year, surging by more than 30 per cent since January.

Eight out of 10 S&P sectors traded higher, with utilities and consumer staples being the laggards.

The Nasdaq has lifted by 0.5 per cent to 6,813, while the Dow Jones and S&P added 0.3 per cent each.

Investor sentiment is relatively high in regards to the Republicans passing their much-touted tax reform agenda.

There are currently two different versions of the tax bill, drafted by the US Senate and House of Representatives.

They will need reconcile key differences in the bill — like whether the corporate tax cuts will take effect immediately or in 2019 — before they present it to President Donald Trump to sign into law.

Australian dollar slips

The ASX is expected to open higher today, amid the broad market rally on Wall Street.

The Australian dollar has slipped by 0.7 per cent and is buying 75.1 US cents, following yesterday's weaker-than-expected trade figures.

However, NAB's head of foreign exchange strategy Ray Attrill said, "Weakness in iron ore exports was the main culprit."

Overnight, the spot price of iron ore fell sharply, by 5.3 per cent, to $US65.70 a tonne.

In economic news, the Bureau of Statistics will release its October housing finance figures — which tracks the number of new owner-occupier home loans.

Also being released today is the latest China trade figures, which may impact the Australian dollar's movements.

"Any disappointment in today's November China trade numbers, for example weaker than expected imports, could be the catalyst for a break below the 75 [US] cents level," Mr Attrill said.

"If not from that, then from a stronger US dollar out of tonight's US payrolls report."

These official US payroll (and unemployment) figures will be released tonight at 11.30pm (AEDT).

Original Article

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