Australian shares staged an afternoon recovery as US President Donald Trump delivered a market assuring State of the Union address.
The benchmark S&P/ASX200 index rose 0.25 per cent to 6,037.7 points, after falling 0.45 per cent in early trade.
Bell Direct equities strategist Julia Lee said it was the "Trump effect" that boosted futures trade on Wall Street, soothed anxious traders and led to afternoon gains on the local market.
The president highlighted a growing US economy, low unemployment and rising wages in his first State of the Union speech.
"There were no big shocks, which was good, and the market gained comfort and stabilisation in the face of rising bond yields globally - a key challenge for the market over the last few sessions," Ms Lee said.
The latest manufacturing data from China and December quarter inflation in Australia came in slightly under expectations, with the latter pushing back the prospects of a 2018 interest rate hike by the RBA, Ms Lee said.
"The local market only went sideways after the release of the CPI data, but later responded to the president's speech," she Lee said.
The major banks followed Wall Street lower in morning trade but gained ground in the afternoon, leaving Westpac down 0.1 per cent at $30.96, National Australia Bank up 0.2 per cent at $29.13 and ANZ up 0.4 per cent at $28.58.
Commonwealth Bank, however, dropped 0.3 per cent to $78.87 after saying it is considering whether to include a financial provision in next week's first-half financial results related to the allegations it breached money-laundering and terrorism-funding laws.
Lower oil and commodity prices hit the energy and materials sector, with Woodside Petroleum declining 0.8 per cent to $33.12, Oil Search dropping 1.8 per cent to $7.57, BHP Billiton losing 0.5 per cent to $30.20 and Rio Tinto 2.2 per cent weaker at $76.85.
Despite announcing a 40 per cent jump in first-half revenue, Origin Energy was 0.1 per cent lower at $9.34.
Sirtex Medical soared 46 per cent to $27.45 after the liver cancer treatment developer agreed to a $1.6 billion takeover offer from US company Varian.
The Australian dollar dropped due to the weaker-than-expected inflation rate of 0.6 per cent in the December quarter, but gained ground in afternoon trade.
ON THE ASX:
* The benchmark S&P/ASX200 index was up 14.9 points, or 0.25 per cent, at 6,037.7 points.
* The broader All Ordinaries index was up 11.2 points, or 0.18 per cent, at 6,146.5 points
* The the SPI200 futures contract was up 21 points, or 0.35 per cent, at 5,981 points
* National turnover was 3.9 billion securities traded worth $7 billion.
CURRENCY SNAPSHOT AT 1700 AEDT
One Australian dollar buys:
* 80.90 US cents, from 80.66 US cents on Tuesday
* 87.92 Japanese yen, from 87.67 yen
* 65.02 euro cents, from 65.23 euro cents
* 56.99 British pence, from 57.46 pence
* 109.45 NZ cents, from 110.20 NZ cents
GOLD:
The spot price of gold in Sydney at 1700 AEDT was $US1,343.51 per fine ounce, from $US1,335.14 per fine ounce on Tuesday.
BOND SNAPSHOT AT 1630 AEDT:
* CGS 4.50 per cent April 2020, 2.0249pct, from 2.0848pct on Tuesday
* CGS 4.75pct April 2027, 2.7689pct, from 2.8188pct
Sydney Futures Exchange prices:
* March 2018 10-year bond futures contract at 97.185 (implying a yield of 2.815pct), from 97.135 (2.865pct) on Tuesday
* March 2018 3-year bond futures contract at 97.805 (2.195pct), from 97.73 (2.27pct).
(*Bond market closes taken at 1630 AEDT previous local session; currency closes taken from 1700 AEDT previous local session)
U.S. stocks gave up earlier gains to trade flat on Wednesday after the Federal Reserve said it sees inflation rising this year, signaling it remains on track to boost interest rates again in March.
The Fed kept rates unchanged but, in a statement following its two-day policy meeting, it repeated that it expected that “further gradual” rate hikes will be warranted.
”They’re more confident in their expectations of rising inflation,” said Kevin Logan, Chief U.S. Economist at HSBC Securities in New York.
The central bank raised rates three times last year and sees three more hikes in 2018 even as it continues to trim its balance sheet on a largely pre-set schedule.
”The Fed’s acknowledgment of the quickening pace of inflation today put three hikes in 2018 into the ‘base-case’ and perhaps raises the prospects for a fourth,” said Mike Terwilliger, portfolio manager, Resource Credit Income Fund.
Stocks had been higher in earlier trading, lifted by a surge in Boeing (BA.N) that helped lead Wall Street out of a two-day slump on Wednesday.
At 2:27 p.m. ET, the Dow Jones Industrial Average .DJI rose 77.9 points, or 0.3 percent, to 26,154.79, the S&P 500 .SPX gained 0.15 points, or 0.01 percent, to 2,822.58 and the Nasdaq Composite .IXIC added 8.81 points, or 0.12 percent, to 7,411.29.
Boeing (BA.N) surged to record high after the planemaker’s full-year profit forecast easily topped estimates.
Advancing issues outnumbered declining ones on the NYSE by a 1.06-to-1 ratio; on Nasdaq, a 1.27-to-1 ratio favored decliners.
The S&P 500 posted 33 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 78 new highs and 41 new lows.
Source: Netwealth Morning Business Roundup
Mushies on Grain Toast to keep those placard bearing, megaphone toting Vegans at bay and a Peach and Mint Tea.
Okay January is done and dusted and so are the Quarterlies. February is upon us - let's see some spectacular news.
Anyone catch an interesting moon last night?
Happy trading, play nicely and make informed decisions.
