ASX set to open marginally higher on progress in US/China negotiations

Stock Markets

Australian shares are poised to start February marginally higher as President Trump expressed optimism about forging a comprehensive trade deal with China, following the resumption of two-day long high-level talks between US and Chinese negotiators on Thursday. President Trump stated that the US delegation including Trump’s top negotiator USTR Robert Lighthizer will be heading to China soon and stated that the relationship between the US and China has never been so advanced. The NASDAQ 100, and S&P 500 were up overnight, with the indices gaining 98.93 (+1.45%) and 29.38 (+1.10%) points respectively. Conversely, the Dow 30 was slightly down, falling 15.19 (-0.06%) points overnight. ASX200 futures are currently up 14.0 points. 

The US Jobs report and related data for January is to be released at 12:30am AEDT Saturday.

Commodities and Currencies

Brent crude prices experienced a strong rise in earlier weeks benefitting from hopes that OPEC will manage to achieve production cuts. Brent crude has continued its rally by rising 0.9% overnight and is currently sitting at $US61.98 a barrel.

Iron ore is continuing its rally and is currently up 3.4% overnight to $US85.34 per tonne.

The spot price of gold is up $10.30 (+0.78%) and is now hovering around US$1325.80.

The AUD is currently up 0.3% to US72.71¢ strengthened by the Federal Reserve’s signal that it could extend its interest rate-hike pause further through the year.

This article was written by Mithun Fernando – Investment Analyst, Rivkin Securities Pty Ltd. Enquiries can be made via mithun.fernando@rivkin.com.au or by phoning +612 8302 3633.