Following a lift from US markets overnight, the Australian share market looks set to open higher this morning. On Wall Street, optimism grew as more and more companies start to reopen after Covid-19 restrictions eased. Shares jumped for many companies benefiting from the restart of the economy. The Trump administration is considering sanctions on Chinese officials, threatening to escalate tensions between the world’s two largest economies. Back home experts warn many businesses will collapse in September when the JobKeeper allowance is withdrawn. On the commodities front gold and oil both fell.
Local economic news due out today
Private New Capital Expenditure and Expected Expenditure, March 2020.
Business Impacts of COVID-19, May 2020.
Wall Street closed higher yesterday: The Dow Jones Industrial Average gained 2.2 per cent to close at 25,548, the S&P 500 closed 1.5 per cent higher at 3036 and the NASDAQ added 0.8 per cent to 9412.
In European markets closed higher, London’s FTSE gained 1.3 per cent, Paris added 1.8 per cent and Frankfurt closed 1.3 per cent higher.
Asian markets closed mixed, Tokyo’s Nikkei gained 0.7 per cent, Hong Kong’s Hang Seng fell 0.4 per cent, and China’s Shanghai Composite closed 0.3 per cent lower.
Taking all of this into equation, the SPI futures are pointing to a 0.9 per cent gain.
Yesterday, the Australian share market closed 0.1 per cent lower at 5775.
Synlait Milk (ASX:SM1) has updated its forecast base milk price for the 2019/2020 season to $7.05 kgMS from $7.25 kgMS. The decision to reduce the forecast base milk price for the season is because, in line with other commodities, dairy prices have eased significantly this year and as a result are lower than they were anticipating when the forecast was set in January. Synlait’s opening forecast for the 2020 / 2021 season is $6.00 kgMS. CEO Leon Clement says: “COVID-19 has created significant global uncertainty. We don’t yet have a clear view of COVID-19’s economic impact, but we do know it will impact demand.” Shares in Synlait Milk (ASX:SM1) closed 2.3 per cent lower at $6.53 yesterday.
One Australian Dollar at 7:45 AM was buying 66.23 US cents, 54.03 Pence Sterling, 71.35 Yen and 60.16 Euro cents.
Iron Ore added 0.1 per cent to US$95.37.
Iron Ore futures suggest a 0.9 per cent gain.
Gold has fallen $1.40 to US$1727 an ounce.
Silver was up $0.16 to US$17.76 an ounce.
Oil was down $1.54 to US$32.81 a barrel.