Shares bucked weak leads to edge higher for the first time in five sessions, boosted by strengthening US equity futures and a rally in the big banks.
At 1pm EST the ASX 200 was nine points or 0.2% ahead at 5216 despite a negative session on Wall Street overnight. The S&P 500 slumped 1.48%, reversing Monday night's rebound, as traders fretted over activity on bond markets. Global share markets have been unsettled by ructions in bonds at the prospect of higher US interest rates and an unanticipated pause in stimulus efforts in Europe and Japan.
"The share market will remain nervous while the current bond sell-off continues," CMC Markets' Ric Spooner told Fairfax. "In these circumstances, the market will be vulnerable to repeats of yesterday's action on Australian markets where rallies are sold. However, investors will also be conscious that the ASX 200 index is already down 7 per cent since early August."
A mixed morning on the ASX saw rises in telecoms +1.5%, financials +0.8% and health +0.7% outweigh declines in gold -1.6%, utilities -1% and energy -0.9%. The index dipped briefly below 5200 for the first time since July 6 before rebounding as US equity futures improved. Dow futures were recently ahead 44 points or 0.24%. China's Shanghai Composite dropped 0.32%, Hong Kong's Hang Seng gained 0.22% and Japan's Nikkei lost 0.24%.
Crude oil futures recouped 22 cents or 0.49% this morning at US$45.12 a barrel. Gold futures were $1.20 or 0.1% weaker at US$1,322.40 an ounce. The dollar was buying 74.82 US cents.
Modest relief rally after a pretty torrid run. The XJO has been somewhat ahead of its peers, starting its decline three weeks ago, so we may be first to bounce. Unfortunately the January uptrend line looks bust, so we may visit 5100 first. Trading: nice low swing entries in LAA and HIL (briefly) for a good wage. Misread BKT and exited for brokerage. Used the mid-morning swing in SYD to get out for a smaller loss.
