Good morning traders. Thanks @ttward, @Ravgnome & the aftermarket loungers. U.S. markets surged overnight giving us a very strong lead-in for a change.

ASX Market Report

The headline news of the cut to the official cash rate came through as expected, cutting 25 basis points to a record low of 1.25%, which helped the ASX 200 to an 11.9 points or 0.19% gain and to outperform its Asia-Pacific peers. The benchmark index is now trading around half of a percent below where it was immediately prior to the surprise election result a fortnight ago.

The IT sector unsurprisingly took another battering after the Nasdaq had plunged overnight. It was led lower by Altium (ALU), which fell 4.29% to $29.21, Afterpay Tough Group (APT) which dropped 3.71% to $22.31, Bravura Solutions (BVS) dropped 11.26% to $4.65, and Xero (XRO) which fell 3.48% to $57.38 per share.

Communications was the top sector for Tuesday, which rose just over one percent. Market and sector heavyweight Telstra (TLS) lead the gains, rising 1.95% to $3.66 after CEO Andy Penn announced intentions to cut another ten thousand people from it’s payroll over the next two years at an investor conference.

The big four banks were all solidly up following the rate cut, Commonwealth (CBA) rose 0.65% to $78.42, ANZ was up 0.8% to $27.76, Westpac (WBC) rose 0.63% to $27.25, and NAB was up 0.38% to $26.43.

Mining heavyweights BHP Group were up 1.36$ to $37.31, Rio Tinto rose 1.49% to $98.56.

Clean TeQ (CLQ) jumped after announcing it had it has commenced a partnering process for its wholly-owned Sunrise Battery Materials Complex. Clean TeQ shares were last trading at 35c a share, up 27.27% on the previous day.

The release of a new action plan for China’s formula sector which appeared to be aimed at squeezing foreign players on Monday has sent share in infant formula makers tumbling. There’s not yet (as of writing) an English version which may explain why it has taken a while for the market to digest exactly what has been proposed. Shares in sector heavyweight A2 Milk (A2M) plunged 8.63% to $13.03, Bellamys (BAL) fell 5.31% to $7.85, and Bubs were down 9.38% to $1.015. Even at the small-cap end of the market there were significant losses, Wattle Health (WHA) dropped 8.33%, Keytone Dairy (KTD) fell 7.21%, and Jatenergy (JAT) fell 3.64%.

At 7am AEST the Aussie dollar was buying 0.6992 USD, 0.5505 GBP, 0.6212 EUR, 75.60 JPY, and 1.0580 NZD.

The ASX 200 futures were pointing towards a 55.5 point or 0.88% rise.

Global Markets Report

U.S. markets surged on the back of comments from Fed Chairman Jay Powell, where he indicated a greater openness to rate cuts in the face of global growth uncertainty, which has not been helped by growing trade tensions between the U.S. and China. Mexican officials also indicated they expected they would avoid the Trump tariffs.

Asian markets had been weaker following the drop in the U.S. markets the previous day. The Shanghai Composite was down 0.96%, Hong Kong’s Hang Seng fell 0.49%, Japan’s Nikkei and the Korean Kospi were flat. But futures are indicating a large reversal after today's rise in the U.S.

European markets were largely positive, with the pan-European Stoxx 600 rising 0.74%. The German DAX rose 1.51% and the FTSE 100 rose 0.41%.

In the United States, the Dow surged 512 points or 2.06% to 25,332, the S&P 500 rose 58.82 points or 2.14% to 2,803, and the Nasdaq more than reversed the previous days loses, rising 194,10 points or 2.89% to 7,527.

Commodities took a back seat for a change, as WTI crude and Gold were largely unchanged.

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