Shares pushed within a couple of points of a ten-year high after US stocks shrugged off anti-Chinese tariffs coming into force tonight.
The ASX 200 reached the midpoint of the session 33 points or 0.5% ahead at 6249, just shy of 6250.8, the index's decade peak on June 25. A solid morning saw the metals & mining sector rise 1.3%, gold 1.2% and financials 0.6%. Health stocks lost 0.2% and utilities 0.1%.
The local market took its cues from Wall Street, which showed no signs of nerves as the White House prepared to impose tariffs on US$34 billion worth of Chinese goods from midnight tonight. The S&P 500 rallied 0.86% overnight. S&P 500 futures were recently off 0.25 points or 0.01%.
"Investors should expect volatility to continue," Mark Haefele, chief investment officer at UBS Global Wealth Management, told Fairfax. "We recommend investors stay invested, but consider five actions: looking to alternatives, hedging equity exposure, improving credit quality, diversifying sector and country risks, and taking a longer-term view."
Asian markets were mixed. China's Shanghai Composite dropped 0.67% and Hong Kong's Hang Seng 0.32%. Japan's Nikkei gained 0.67%.
Crude oil futures fell another 10 cents or 0.14% this morning to US$72.84 a barrel. Gold futures lost $3.70 or 0.29% to US$1,255.10 an ounce. The dollar was buying 73.8 US cents.
The market seems reluctant to let go of the idea that Trump is bluffing on trade. That may change in the next few sessions. In general the market seems complacent about the likely impact on global trade, consumer demand, demand for raw materials, production, etc. Always hard to tell in these situations whether that's because the market is stupid or knows more than an average schmuck like me. Hope it's the latter. Trading: small positions in KFE and LNU.
