Wall Street and European markets jumped on easing Hong Kong tensions and Brexit developments. (AP: Richard Drew, File)
Australian shares are set to open higher on the prospect of easing tensions in Hong Kong, a potentially delayed Brexit and strong economic figures from China.
Market snapshot at 7:45am (AEST):
- ASX SPI futures +0.3pc at 6,555, ASX 200 (Monday’s close) -0.3pc at 6,553
- AUD: 67.56 US cents, 55.89 British pence, 61.58 euro cents, 71.57 Japanese yen, $NZ1.07
- US: Dow Jones +0.9pc at 26,355, S&P 500 +1.1pc at 2,938, Nasdaq +1.3pc at 7,977
- Europe: FTSE 100 +0.6pc at 7,311, DAX +1pc at 12,025, CAC +1.2pc at 5,532, Euro Stoxx 50 +0.9pc at 3,451
- Commodities: Brent crude +3.8pc at $US60.48/barrel, spot gold +0.4pc at $US1,551.80/ounce, iron ore +2.4pc at $US91.32/tonne
By 7:10am (AEST), ASX futures were up 19 points or 0.3 per cent.
The optimism led to a surge in commodity prices with iron ore, copper and aluminium making strong gains.
The Australian dollar lifted 0.5 per cent to 67.9 US cents.
‘Starting from zero every day’
On Wall Street, the Dow Jones index jumped 237 points, or 0.9 per cent, to 26,355.
The broader S&P 500 added 1.1 per cent, while the tech-heavy Nasdaq index rose 1.3 per cent.
European markets also received a boost, with London’s FTSE up 0.6 per cent and Germany’s DAX lifting 1 per cent.
But no stock market did better than Hong Kong’s Hang Seng index, which surged 3.9 per cent.
This was after Hong Kong’s leader, Carrie Lam, withdrew a contentious extradition bill that sparked 13 weeks of mass protests.
Markets also lifted after British MPs successfully passed a bill intended to block a no-deal Brexit, delivering another humiliating defeat to UK Prime Minister Boris Johnson.
“Geopolitics are lifting everything much in the way it drowned everything yesterday,” said Paul Nolte, portfolio manager at Kingsview Asset Management.
“It’s as if the slate gets wiped clean and we’re starting from zero every day — the markets are very binary.
“It’s either ‘happy days are here again’ or ‘things are terrible and we’re falling into the abyss’.”
Furthermore, the latest data from China revealed that its services sector expanded at its fastest pace in three months despite headwinds like the protracted US-China trade war.
Spot gold prices have risen to $US1,552.40 per ounce.
Brent crude oil has jumped 3.8 per cent to $US60.48 a barrel.