The S&P/ASX 200 Index had a stonking day, closing up 109 points or 2.55% higher to 4281 points after positive leads from overnight markets. In after hours trading, the index is up 8 points, although Euro and US markets are pointing to slightly lower or mixed opens.
Asian markets experienced similar gains, with Japan’s Nikkei 225 up 1.75% at 8640 points, the Hang Seng almost 4% up to 19963. The Shanghai Composite lagged and is currently up 16 points or some 0.6% to 2524 points.
In other risk assets, the AUD fell slightly – probably on RBA forecasts – back below 1.04 after a good night whilst WTI crude rose slightly, now at $94.33 USD a barrel.
Gold was steady during the Asian session and is currently at $1764 USD an ounce after a cracking run last night or $1694 AUD an ounce.
Movers and Shakers
Unicorns and rainbows on the ASX today, with all sectors up, the usual suspects – materials, energy and financials – leading the way.
The banks were bid up strongly, with ANZ up 2.6%, Commonwealth (CBA) up 2.1%, National Australia Bank (NAB) also up 2.1% and Westpac (WBC) up 2% even.
Macquarie (MQG) did better, up 3.6%, whilst healthcare stalwart Cochlear (COH) continues to fall, now below $53 a share. Its “twin” CSL gained 1.8% whilst Telstra (TLS) was bid up almost two percent.
BHP Billiton (BHP) lead the broad gains today, up nearly 4%, whilst Rio Tinto (RIO) put on over 5%, gold miner Newcrest Mining (NCM) had another good day, rising 3.6%
Fortescue (FMG) finished the day up nearly 8% and Woodside Petroleum (WPL) was up 1.3%
I asked yesterday if Woolworths (WOW) is bottoming, after gaining 2% it put on another 1.6% today – note, The Prince Super Fund bought some for a long term dividend investment.
The Charts
Yesterday I suggested that the short term bullish case is reinforced by a bounce off support and the deceleration in the falling prices since the false breakout above the medium term downtrend line. Today’s action lifts the closing support line into a short term uptrend with a probable intermediate uptrend if the market clears resistance at 4300 points in the next few days.
A break below the green uptrend, which doubles as short term support, would likely complete a very short term head and shoulder pattern (the false breakout being the head) resulting in the resumption of the medium term downtrend.
As seen on the weekly chart below, the market still needs to clear this overhead resistance and then the long term average at ca. 4450 for a sustained rally.
Watch my “Chart of the Day” posts for continued analysis of US, Euro and Asian markets which will lead the way.