No more one day wonders on Wall Street overnight, or in Europe where the rebound was very much muted compared with the frenetic trading in the last hour of trading on Wall Street and in the Australian market.
No, its back to the grinding reality of a weak economy, weak commodity prices (led by iron ore) and fretting investors.
So no respite for iron ore miners led by the embattled Fortescue Metals (FMG), with the global iron ore spot price easing overnight to $US54 a tonne. That remains the six year low for the metal under the current index system of price setting.
The news will won’t come as a relief no doubt to the sector, because it means there are factors other than the value of the greenback at work in the iron ore market.
And prime among those those factors is the continuing weak demand from Chinese steel mills.
The news comes on top of a slide back in the oil price, a fall in the value of the Aussie dollar to around 76.20 US cents in Asian trading this morning and a small loss overnight in the share futures contract.
The bullishness of yesterday’s 1.8% surge here yesterday in the physical market vanished overnight, as the boomlet vanished in other markets except gold, which was up around $US19 an ounce this morning and US bonds where the 10 year yield remained steady on 1.98%.
In fact it was a one day wonder concentrated into an hour or two of trading late in the day on Wall Street.
Our market’s $32 billion rise in value yesterday will be chipped away from the start of trading this morning.
The surge was a one off and the 108.5 point gain in the ASX 200 will be hard to retain in coming days.
Reserve Bank Governor Glenn Stevens is due to make a major speech in Melbourne at lunchtime today in which the economy will feature heavily. That will be the major factor on sentiment going into the weekend.
On Wall Street overnight, The S&P closed down 10.38 points, or 0.5%, at 2,089.12, as oil prices dropped and energy stocks helped lead the way lower.
The Dow fell 117.16 points, or nearly 0.7%, to end at 17,959.03 (leaving 100 points of Wednesday’s gains on the table).
But the Nasdaq Composite went against the trend, rising 9.55 points, or 0.2%, to end at 4,992.38.
