The S&P/ASX 200 Index jumped almost 2% today on rumor of another European bailout and following 6 down sessions in a row for “undollar” assets. The market closed 73 points or 1.8% higher to 4058 points, creating a “bullish engulfing candle” with very short term support at 3985 points and overhead resistance at 4150 points:
If the market can get above this level in the short term, a rally to 4300-4400 points is feasible. The probability for that lies with the US and Euro markets, as always.
The US markets on Friday after the Thanksgiving holiday closed down slightly, but the S&P500 futures are pointing to a 2% higher open at around 1174 points, whilst in Europe, another Italian derived rumor has pushed expectations for the UK FTSE and the German DAX to also rise over 2%
In after hours trading, the Australian SPI futures have improved and is trading at 4070 points in anticipation of these higher opens. The Euro (EUR/USD) is slowly returning to support at just above 1.32, not participating as strongly as its equity brothers.
It is currently trading at 1.3298 as the USD Index pauses on its breakout against the undollar assets, now sitting just below resistance at 79.65:
Asian markets had a good day, Japan’s Nikkei 225 was up 1.5% at 8287 points, the Hang Seng jumped nearly 2% to 18029 points and the Shanghai Composite currently up 0.25% or 6 points to 2386 points remaining at depressed levels.
In other risk assets, the AUD jumped over 1 cent against the USD, or 1.4% and is currently at 98.42 cents. WTI crude had similar gains of 1.9% and is now at $98.51 USD a barrel, whilst Gold was bid up just over 1% during the Asian session to $1708USD an ounce. In Australian dollars however, gold is currently trading at $1732 AUD an ounce.
Movers and Shakers
Unicorns and rainbows today on the board of the ASX, with the usual suspects materials and financial sectors putting on the most gains, up 2.5% each.
The banks were all bid up strongly (and spruiked by The Pascometer no less, even though he forgets what could happen to those delicious yields if the banks can’t get access to funds), with ANZ up 2.3%, Commonwealth (CBA) up 3.3%, National Australia Bank (NAB) up a whopping 4% in a strong one day reversal whilst Westpac (WBC) also gained nearly 4% to be over $20 a share again.
Macquarie (MQG) gained nearly 6% as the shorts dived for cover, even though it remains in a dominant long term downtrend, whilst healthcare standout Cochlear (COH) followed the index, putting on 1.5% and also remains at depressed levels.
Its “twin” CSL did not fare as well, only putting on 0.7% whilst Telstra (TLS) was flat for the day, as investors sought “bargains” in other stocks.
To the holes in the economy (sic), and BHP Billiton (BHP) put on 2.3% after bouncing off short term daily support at $34 per share
Its “twin” Rio Tinto (RIO) was up similarly, whilst gold miner Newcrest Mining (NCM) gained back all of Fridays losses, up just over 3%, Fortescue (FMG) was also a strong performer putting on over 4%
Rounding out the ASX8, Woodside Petroleum (WPL) had another bad day amongst the green lights, down another 2.3% as investors continue to digest its capital expenditure plan.