Australian shares are expected to open higher today, on the back of a Wall St rally and higher gold and oil prices.
Even Bitcoin is getting in on the action as it closes in on a record high.
ASX futures were up 41 points or 0.6% to 7,383 near 7am AEDT.
Here’ what we saw:
- The Aussie dollar rose from lows near US74.55 cents to highs near US74.85 cents and was near US74.75 cents at the US close.
- Global oil prices were firmer on Tuesday. Freezing temperatures forecast for northern China raised expectations of higher heating oil demand.
- Brent crude rose by US75 cents or 0.9% to US$85.08 a barrel.
- The US Nymex crude price rose by US52 cents or 0.6% to 7-year highs near US$82.96 a barrel.
- Base metal prices were lower on Tuesday.
- Copper fell 7.2%.
- Zinc fell 5.7%.
- Nickel was the sole gainer, up by 0.5%.
- Gold futures price rose by US$4.80 or 0.3% to U$1,770.50 an ounce.
- Spot gold was trading near US$1,769 an ounce at the US close.
- Iron ore fell by US65 cents or 0.5% to US$123.50 a tonne.
Australian market
The S&P/ASX200 closed 0.1% lower on Tuesday at 7,374.9 points, dragged down by large mining companies.
BHP fell 1.8% after revealing a 5% decline in iron ore shipments, while Rio Tinto was down 3.1% after last week reporting a similar decline.
However, the volume of companies on the All Ords, the top 500 companies, saw it closing 0.5 points, or 0.01%, higher yesterday.
On the back of Wall Street’s good performance overnight, we should see gains on the ASX this morning and it won’t be the only good news to hit the headlines.
Newly minted NSW Premier Dominic Perrottet will today announce a boost for the tourism sector including $50 accommodation vouchers for all adults in the state.
The announcement comes as the first flights from NSW to Victoria, in which unvaccinated people are not required to quarantine, touch down on the Tullamarine tarmac.
That’s good for tourism and related sectors and investors within.
As we open up, however, the battle will be getting workers back into city offices.
Flexible work expectations are now part of working life.
“Businesses have had to recognise that a more flexible way of working is not an aberration, and it’s not only relevant during a pandemic, but it is here for the longer term,” Havas Group AUNZ chairman Anthony Freedman said.
Businesses will make their own arrangements, but a hybrid model is highly likely now for most workplaces.
According to Freedman, if business owners and managers really want staff in the office full time, they may have to come up with creative ideas to lure them back or even offer something as simple as free lunches.
Saving $10 or more a day on lunch could well be a major enticement, especially with crowded train transport costs having to once again be factored in.
“Some of it is about just trying to get people past that initial reluctance, and others probably require some serious operational thinking around how you look after people’s safety within the work environment,” Freedman said.
Looks like the world is about to change again as it finds a way to adapt to post-pandemic life, meaning some sectors such as tourism will be huge winners, while commercial real estate could still suffer.
Australian indices
- ASX 200 fell 0.084% to 7,374.90.
- ASX24 futures rose 0.6% to 7,383.
- S&P/ASX Small Ordinaries rose 0.51%% to 3,545.10.
- All Ordinaries rose 0.0065%% to 7,690.20.
US markets
US gains overnight were led by Healthcare, up 1.3% and Technology up 1.0%.
After releasing earnings results shares in Johnson & Johnson (NYSE:JNJ) rose by 2.3% with Travelers up 1.6%.
It wasn’t so good for Procter & Gamble (NYSE:PG), which fell by 1.2% after highlighting rising commodity and freight costs.
Shares in Atea Pharmaceuticals fell 66% after its experimental COVID-19 antiviral pill failed to help patients with mild and moderate Covid-19.
Squid Game makes Netflix a winner
Netflix was a winner after profits and subscriber numbers bounced higher on the back of the success of Squid Game and the imminent return of The Witcher.
Netflix reported 4.4 million net new paid subscribers in the third quarter, eclipsing its 3.5 million forecast and the 3.78 million analyst forecast. Company insiders expect Q4 to be even better, with 8.5 million new subscribers to the platform.
Some analysts predict it could go higher than 10 million, making Netflix a stock to watch in the coming months.
“After a lighter-than-normal content slate in Q1 and Q2 due to COVID-related production delays in 2020, we are seeing the positive effects of a stronger slate in the second half of the year,” company executives said in a letter to shareholders Tuesday.
Netflix reported earnings of US$1.45 billion, or $3.19 a share, up from $1.74 a share a year ago, beating expectations of $2.57 a share. Netflix’s revenue also jumped to $7.48 billion, up from $6.44 billion a year ago.
Following its announcement, shares in Netflix rose nearly 2%, although it did pare back.
So far Netflix is up 17% this year.
Bitcoin to go bang
Bitcoin reached $64,309 yesterday, just 0.9% away from its all-time high of $64,889 in April.
The rise came on the back of the debut of ProShares Bitcoin Strategy ETF, the first bitcoin-linked exchange-traded fund (ETF) in the US.
We’ll have more about Bitcoin in our midday wrap.
US indices
- Dow Jones rose 0.6% to 35,457.31.
- S&P 500 rose 0.% to 4,519.63.
- Nasdaq rose 0.7% to 15,129.09.
European markets
Europe was also on the up yesterday.
Utilities rose 1.3% with Industrials up 0.9%.
Food & beverage dragged things down, with the sector falling 0.9% due to a 3% fall by Danone (OTCQX:DANOY), which warned about rising inflationary pressures.
Telecom shares fell 0.8%, dragged lower by a 3.7% fall in shares of Ericsson. Ericsson announced plans to reduce its operations in China.
In London trade shares in Rio Tinto rose by 1.0% and shares in BHP lifted by 1.1%.
European indices
- STOXX 600 rose 0.33% to 468.58.
- German Dax rose 0.3% to 15,515.83.
- UK FTSE up 0.2% to 6,217.53.