Steady Chinese factory data helped push Australian shares higher during the last session of the worst month for the ASX in 16 months.
The ASX 200 was 20 points or 0.35% ahead at 5738 at the halfway point, on track for a second day of gains against the general trend this month. The benchmark index was track to record a May loss of almost 200 points, its worst return since January 2016. However, IG strategist Chris Weston warned that the worst was not necessarily behind as investors prepare to lock in tax losses next month before the end of the tax year.
"For some the idea of turning the page and closing what has been a fairly bleak month to be long the Aussie equity market will be welcomed," Weston told Fairfax. "What won't be welcomed is the idea that June is actually the worst month to be long or tracking the Aussie equity market, with the average loss over the past decade at 2.2%. We have seen the past four months of June down by an average of 3.1% and while past performance obvious doesn't predict future returns it is a consideration."
Helping steady nerves this morning was news that growth in a gauge of Chinese factory activity held steady at 51.2 for a second month, defying expectations of a mild deterioration to 51. Services activity improved to 54.5 from 54 in April.
China's Shanghai Composite rose 0.43% upon resuming trade after the first time this week. Hong Kong's Hang Seng gained 0.16% and Japan's Nikkei dropped 0.09%. Dow futures were recently up nine points or 0.04%.
Crude oil futures slid 30 cents or 0.6% this morning to US$49.36 a barrel. Gold futures shed $3 or 0.24% to US$1,262.70 an ounce. The dollar was buying 74.53 US cents.
Trading: a few glimmers of hope after a depressing week when nothing behaved the way I anticipated. ING provided a regulation bounce - didn't get a full fill at the low but the relief at seeing a share do what I expected was immeasurable. AZS is showing life after testing support. Even API may finally be putting in a reversal candle, albeit much lower than my entry on Friday. Balanced against all that was the MRD sandwich I had to swallow when the support at 0.9c went. What a stinker that has proved for anyone awaiting drill results.
