Market Update & Important Indicators:
The Dow Jones Industrial Average was on track to rise for a third consecutive day, a first for the blue-chip index in more than a month, as some investors temporarily put aside their concerns about trade and bought shares of stocks that have been struggling. Shares of Boeing and other manufacturing giants led the Dow higher intraday, a sign that investors were less wary of an all-out trade war after the U.S. signalled a willingness to reach a trade compromise with China. Shares of chemicals and mining companies, some of which have stumbled since the steel and aluminium tariffs were first unveiled, also rose. Despite the recent gains, some money managers say the market hasn't stabilized. The Dow traded in a broad range after swinging 741 points a day earlier. The blue-chip index rose as much as 358 points in morning trading and gave up most of those gains before resuming its climb, eventually finishing up 241 points to finish 24,505. The S&P 500 rose 0.7% whilst the NASDAQ rose 0.5%. The U.S. gold price dropped back overnight, shedding 0.5% to finish at 1,326.20 US$/oz.
European stocks booked the best one-day rally in nearly two years and ended at a three-week peak as investors' concerns about a global trade war weren't enough to stop a rotation in to assets perceived as risky such as stocks. The Stoxx Europe 600 index rallied 2.4% to 376.13, the first gain in a week after drops of 0.5% for both Tuesday and Wednesday. In Frankfurt, the DAX 30 soared 2.9% to 12,305.19, after a 0.4% drop on Wednesday, representing its best single-session gain since April 24, 2017. In Paris, the CAC 40 index rallied 2.6% to 5,276.67, also its best one-day rise since late April of 2017. Meanwhile, the U.K.'s FTSE 100 index jumped 2.4% to 7,199.50 — its best daily rally since June 29, 2016.
Asia-Pacific shares rose as investors welcomed signals that the U.S. and China are open to negotiations rather than escalating threatened tit-for-tat trade tariffs. Stocks in Japan and Singapore led broad gains across the region, rising 1.8%, followed by shares in South Korea with a 1.4% increase. Markets in mainland China, Hong Kong and Taiwan were closed for holidays. Market sentiment staged a U-turn overnight, with major U.S. stock indexes swinging to strong gains by the close as fears over China's plans to impose trade countermeasures against the U.S. gave way to optimism the countries will ultimately reach a compromise. Japan's Nikkei was led higher by telecom companies, drug firms and banks. In South Korea, the Kospi was largely driven up by a 4% gain in Samsung Electronics. Singapore's banks buoyed the Straits Times Index.
Australian stocks joined gains across most of Asia-Pacific on hopes that U.S.-China trade hostilities will give way to a negotiated settlement. Despite fading in the final hour, the S&P/ASX 200 rose for a second straight day with a gain of 0.5% to 5788.8. Major banks drove the market's advance, continuing a solid start to the quarter. Consumer stocks also notched gains, and the energy sector benefited from a recovery in oil prices in the Asian session.
The London Metal Exchange’s 3-month copper contract rose overnight, rising 1.37% at 6,816/t. The other base metals were mainly higher overnight. Aluminium prices rose 0.9% to 1,987/t, whilst lead prices jumped 0.3% to 2,378/t. Tin prices rose 0.6% to 21,083/t, whilst nickel prices were the best performing base metal in the LME, increasing 1.3% to 13,273/t. Zinc prices were the only loser in the LME base metals, shedding 0.7% at 3,240/t.
Recent Contacts & Presentations:
Alt Resources Ltd (ARS), Coziron Resources Ltd (CZR), ABM Resources Ltd (ABU), Vital Metals Ltd (VML), Todd River Resources Ltd (TRT), Pacific Energy Ltd (PEA), Carnarvon Petroleum Ltd (CVN), Australian Mines Ltd (AUZ), Australian Finance Group (AFG), Paladin Energy Ltd (PDN), Cooper Energy Ltd (COE), Medibio Ltd (MEB), Botanix Pharmaceuticals Ltd (BOT), Salt Lake Potash Ltd (SO4), Golden Mile Resources Ltd (G88), NTM Gold Ltd (NTM), Ausmex Mining Group Ltd (AMG), Matrix C&E Ltd (MCE), Austal Ltd (ASB), Decmil Group Ltd (DCG), Ventnor Resources Ltd, Ausdrill Ltd (ASL), Alice Queen Ltd (AQX), PNX Metals Ltd (PNX), Alliance Resources Ltd (AGS)
Please read Argonaut's Important Disclaimers & disclosures
Log in to the client area below to download the full Morning Note PDF
