Yesterday, the S&P/ASX 200 added a huge 91 points (2.08%) to close at 4,495.70. And the index has been potentially predicted to do again today, already 1% higher.
The June quarter gross domestic product (GDP) figures released yesterday and were one of the main drivers of the rally. The economy grew 1.2% for the second quarter which was higher than the 0.9% predicted by economists. Annualised, GDP growth for Australia is now 3.3%.
Overnight, the Dow Jones Industrial Average had a massive 254 point gain, closing at 10,269.47. The ISM Factory index rose to 56.3 for August, up from 55.5. Anything above 50 is considered growth.
Adding to the optimism was China’s Purchasing Managers Index (PMI) rising to 51.7, up from 51.2 in July.
‘Investor sentiment was so negative that any flicker of light was going to move sentiment with quite a roar, and that’s what we got,’ said an economist at JP Morgan Private Wealth Management.
The US market seemed to completely ignore the private sector employment data also released yesterday. The data showed that employment in the private sector fell by 10,000 jobs in August. Senior economist, Steve Biltz said that if put the manufacturing data and employment data together you’re still looking at a flat economy.
The FTSE gained 141 points, ending the day at 5,366.41. The UK market received a boost from all of the positive data, including the unexpected Australian growth. Mining stocks Rio Tinto [LON: RIO] and Xstrata [LON: XTA] both had 6.09% in their share price.
The Nikkei closed higher by 102 points, to 8,927.96. Following the lead form the US, the Nikkei is currently 1.6% higher this morning.
The price of spot gold in Australian dollars is $1,367.13, while in US dollars it’s $1,243.97. The price of silver in Australian dollars is $21.27 and in US dollars it’s $19.34.
The Aussie dollar versus US dollar is AUDUSD 0.9097 and against the Japanese Yen it’s AUDJPY 76.76.
Crude Oil closed at USD$73.91.
For the biggest movers on the market yesterday click here…
That’s all I have for you today, see you tomorrow.
Shae.
