Aussie shares have positive leads as trading resumes after the Christmas break.
Wall Street’s bull run continued overnight in thin Boxing Day trade. Optimism over a US-China trade deal helped the S&P 500 hit a fresh all-time high and the Nasdaq crack 9,000 for the first time.
The S&P 500 rose 17 points or 0.51 per cent after China’s commerce ministry said it was in close touch with the US as negotiators work to finalise a phase one deal before signing in the first week of January. On Christmas Eve, US President Donald Trump said he and Chinese President Xi Jinping would meet for a signing ceremony. “The deal is done, it’s just being translated right now,” Trump said.
A knockout holiday shopping season from Amazon helped the Nasdaq break new ground. The tech-heavy index rose 70 points or 0.78 per cent to close at 9,022. Amazon shares jumped 4.45 per cent after reporting sales through its Prime service almost quadrupled this year. Mastercard said online shopping increased by 18.8 per cent to a record in the run-up to Christmas, while sales in stores increased just 1.2 per cent. The Dow trailled with a gain of 106 points or 0.37 per cent.
Concerns over a spike in claims for unemployment benefits were soothed by a second week of lower claims. The number of people filing for benefits dropped by 13,000 last week to 222,000.
US stocks have enjoyed a strong ‘Santa rally’. Last night’s rise delivered the Nasdaq a tenth straight record close, its longest run since at least 1998. The S&P 500 finished flat on Christmas Eve, but is up 3 per cent for the month and 29 per cent for the year.
In contrast, the ASX 200 only turned positive on Christmas Eve in the closing auction, turning a three-point loss into a nine-point gain. The late reversal ended a run of three straight losses for the Australian benchmark.
Asian markets moved higher yesterday. China’s Shanghai Composite rose 0.85 per cent. Japan’s Nikkei gained 0.6 per cent.
Mining giants BHP and Rio Tinto may provide momentum for the local market today after gains in US trade. BHP’s US-listed stock rose 0.64 per cent overnight. Rio Tinto gained 0.83 per cent. UK trade was suspended for Boxing Day holidays. The spot price for iron ore landed at China’s Tianjin port eased $1.15 or 1.3 per cent to $US89.70 a dry ton.
A three-month high in crude will provide a solid platform for oil companies. Brent crude settled 72 cents or 1.1 per cent ahead at $US67.92 a barrel after a report showed an unexpectedly sharp drop in US stockpiles last week. The US benchmark also closed at its highest level in more than three months.
Gold advanced for a third session to an eight-week peak. The precious metal for February delivery settled $9.60 or 0.6 per cent higher at $US1,514.40 an ounce.
The London Metal Exchange was closed overnight, and saw thin volumes during a generally downbeat session on Christmas Eve. While copper and aluminium edged up 0.2 per cent, lead gave up 1.1 per cent, nickel 1.2 per cent, tin 0.2 per cent and zinc 2.1 per cent.
The recent recovery in the dollar continued this morning, lifting the Aussie more than four-tenths of a cent to 69.48 US cents.
The domestic economic calendar is empty today. Wall Street has a report on crude oil inventories scheduled for tonight.