Trump promises to facilitate an orderly transition of power: Aus shares to open higher

Market Reports

by Katrina Bullock

Aussie shares are set to open higher, following news that President-elect Joe Biden has been certified the winner of the 2020 Presidential election by both the House and Senate. This occurred just hours after pro-Trump protesters stormed the US Capitol building. Speaker of the US House of Representatives Nancy Pelosi has joined the call to remove Trump from office, saying he “incited an armed insurrection against America”, and that “the gleeful desecration of the US Capitol which is the temple of American democracy, and the violence targeting congress, are horrors that will forever stain [the] nation’s history.” She called for Trump to be removed from office immediately, by invoking the 25th amendment. This amendment allows the Vice President to become the President if the current President becomes unable to do his job. Pelosi says that “if the Vice President and Cabinet do not act, the Congress may be prepared to move forward with impeachment”, saying that that the overwhelming sentiment of her caucus. President Donald Trump appears to have changed his tune since the riots began, saying he still disagrees with the election result, but now promises to facilitate an orderly transition of power. Meanwhile, he has been banned from Facebook, Instagram and Twitter. This political upheaval hasn’t affected the market’s optimism though. All of the major US indices ended the session higher and yesterday the Australian market enjoyed its best day in almost 2 months.

Markets

Wall Street closed higher yesterday: The Dow Jones Industrial Average gained 0.7 per cent, the S&P 500 added 1.5 per cent and the NASDAQ added 2.6 per cent.

European markets closed higher: London’s FTSE gained 0.2 per cent, Paris was up 0.7 per cent and Frankfurt advanced 0.6 per cent.

Asian markets closed mixed: Tokyo’s Nikkei added 1.6 per cent, Hong Kong’s Hang Seng lost 0.5 per cent, and China’s Shanghai Composite gained 0.7 per cent.

Taking all of this into equation, the ASX futures are pointing to a 21 point lift at the open. Yesterday the Australian share market closed 1.6 per cent higher or 105 points higher at 6,712.

Company news

Accent Group (ASX:AX1) says its EBITDA for the half year to 27 December 2020, is expected to be between $95 and $98 million. This is a jump of around 40 to 45 per cent compared to the first half of last year. The bounce in earnings is driven by increased sales in November and December during the cyber events and the lead up to Christmas. The company says it has also implemented disciplined cost controls and had the benefit of rental abatements, not to mention the $9.4 million in net wage subsidies it expects to receive in the first half of this year. Perhaps the most influential factor though was Accent’s record digital sales during the first half, which were up 110 per cent on the prior year to $108.1 million. Shares in Accent Group (ASX:AX1) closed 0.8 per cent lower at $2.35.

Currencies

One Australian Dollar at 8:30AM was buying 77.70 US cents, 57.28 Pence Sterling, 80.67 Yen and 63.32 Euro cents.

Commodities

Iron Ore futures suggest a 3.02 per cent rise.
Gold has gained $1.30 to US$1,915 an ounce.
Silver has gained $0.04 to US$27.30 an ounce.
Crude oil has risen $0.11 to US$50.94 a barrel.