Broad gains in risk assets this morning helped Australian shares rally for just the second time in eight sessions.
At lunchtime the ASX 200 was nine points or 0.2% stronger at 4345 after earlier running as high as 4364. Financials (-0.2%) and consumer discretionary stocks (-0.1%) were the only laggards as most sectors advanced. The biggest rises came in energy +1.3%, health +1.2% and gold +0.8%.
"The good news is the tone of Friday's White House meeting but the prospect of no agreement until at least mid-December fits our view that the two sides are starting negotiations from rather distant points," Sean Callow, senior currency strategist at Westpac, told Reuters. "As such, there will be plenty of negative headlines in coming weeks that weigh on Treasury yields and boost USD, which is yet again trading like a safe haven even when the bad news is generated by the US."
Friday's improved mood on Wall Street fed gains on a range of risk assets this morning, including oil, metals, the Australian dollar, US share futures and most Asian equities. Hong Kong's Hang Seng put on 0.42% and Japan's Nikkei added 1.47%. Shanghai slipped 0.14%. Dow futures were recently up 30 points or more than 0.2%.
Crude oil futures rallied 60 cents this morning to US$87.59 a barrel. Spot gold was $7.30 firmer at US$1,721.30 an ounce. Copper rallied three cents or 0.7% in the US to US$3.48. The dollar was buying $US1.0372.
A "risk on" morning in most markets, so it's disappointing, if unsurprising, to see the XJO struggle to hold its gains. Partly a response to the soft open in Shanghai. Volumes are poor and there are too many unknowns in the weeks ahead to raise much enthusiasm. I used the temporary bounce in MPO to cut my losses and spent the rest of the morning looking for a trade that still hasn't come.
