AUD sees a four-month high against the greenback: ASX poised to rise at the open

Market Reports

by Rachael Jones


The Australian share market is expected to open slightly higher. Today all eyes will be on the Reserve Bank’s policy statement at 2:30 pm Australian Eastern Standard Time to discuss our economic recovery. Wall Street saw stocks rise as investors optimism grew on economic recovery. Although in America there are still tensions with China, as China has ordered its state-owned companies to stop purchases of soybeans and pork from the US. America is also struggling with increasingly violent protests in a number of states over the death of George Floyd at the hands of police, an unarmed black man. Our dollar saw a surge against the US greenback, the highest since Janyuary.

Local economic news due out today

The Australian Bureau of Statistics (ABS) will issue the ‘Business Indicators’ publication that includes data on profits, sales, wages and stocks. The quarterly balance of payments figures are also released with government finance, CBA credit & debit card and weekly consumer sentiment data.

Also today, the Reserve Bank meets with the official cash rate expected be left at 0.25 per cent and the target for the yield on 3 year Australian Commonwealth Government Bonds also retained at 0.25 per cent.

Markets

Wall Street closed higher yesterday: The Dow Jones Industrial Average gained 0.4 per cent to close at 25475, the S&P 500 closed 0.4 per cent higher at 3056 and the NASDAQ added 0.7 per cent to 9552.

In European markets closed mixed London’s FTSE gained 1.5 per cent, Paris added 1.4 per cent and Frankfurt closed 1.7 per cent lower.

Asian markets closed higher, Tokyo’s Nikkei gained 0.84 per cent, Hong Kong’s Hang Seng added 3.4 per cent, and China’s Shanghai Composite closed 2.2 per cent higher.

Taking all of this into equation, the SPI futures are pointing to a 0.2 per cent gain.

Yesterday, the Australian share market closed 1.1 per cent higher at 5819.

Company news

Yancoal (ASX:YAL) has successfully completed a refinancing of the existing syndicated bank guarantee facility. The facility being replaced had a $1,000 million capacity and was due to expire on 1 September 2020 The replacement bank guarantee facility has a $975 million capacity and is secured against the assets of certain subsidiaries of Yancoal Australia. The replacement facility has a three year maturity. The covenants are substantially similar to those on the facility being replaced and will now be tested on a less frequent six monthly basis. Shares in Yancoal (ASX:YAL) closed 1.9 per cent lower at $2.17 yesterday.

Currencies

One Australian Dollar at 7:45 AM was buying 68.09 US cents, 54.54 Pence Sterling, 73.28 Yen and 61.14 Euro cents.

Commodities

Iron Ore futures suggest a 2.1 per cent dip.
Gold has fallen $1.40 to US$1750 an ounce.
Silver was up $0.33 to US$18.83 an ounce.
Oil was down $0.03 to US$36.17 a barrel.