The Australian market will open up higher this morning after those so-called Brexit 2 fears in global financial markets eased.
That was despite more new lows for some key global fixed interest securities, a rise in gold, while a modest rebound by oil futures helped turn sentiment on Wall Street.
The overnight futures market has the ASX 200 opening up more than 30 points – if that is sustained through today, it would be a solid performance compared to the last two days. The Aussie dollar regained the 75 US cents as market fears eased.
Wall Street’s rebound followed a nasty day’s trading in European markets, as Asian markets sold off as well.
Wall Street reversed early losses, following on from Europe’s losses which saw Britain’s pound sank below $US1.30 for the first time in more than three decades.
Investors noted the minutes from the Fed’s last meeting which didn’t advance market thinking about the Fed’s next move on US interest rates – Brexit remains a concern, but what was happening in the markets confirmed that.
Wall Street rebounded on positive US economic data showing strength in the services sector, and a late jump in oil prices.
The Dow rose 78 points, or 0.44%, to 17,918.62, the S&P 500 added 11.18 points, or 0.54%, to 2,099.73 and the Nasdaq Composite gained 36.26 points, or 0.75%, to 4,859.16. Oil prices rose in late trading with US crude future sending up 2.5% with Brent crude moving to $US49.17 a barrel and West Texas crude to $US47.81.
Gold rose to $US1,365 an ounce, after touching $US1,375, but fell in early Asian trading this morning.
Stocks in Europe, emerging markets and most of Asia all fell more than 1% and the MSCI’s all-world stock index dipped 0.4%.
U.S. Treasury yields also edged up late in the day, after 10-year and 30-year bonds hit all-time lows. The 10-year yield fell as low as 1.321% and the 30-year touched 2.098%.
Us markets are now focused on Friday night’s US employment and jobless reports with expectations jobs creation is back on track and generated around 180,000 jobs last month against that very low 38,000 in May.
In London three more big fund managers – Henderson Global, Columbia Threadneedle and Canada Life joined Aviva, Standard Life and became the latest British commercial property funds to freeze redemptions – taking the amount frozen in these commercial property funds to more than $US26 billion – or around half the amount of money invested in these funds in the UK.
