Sunday, April 18, 2021

Australian share market opens flat as fears rise over spread of NSW coronavirus outbreak into Victoria

Australian share market opens flat as fears rise over spread of NSW coronavirus outbreak into Victoria

The Australian stock market has opened flat in the final trading session for 2020 as fears grow the outbreak of coronavirus in NSW has spread into Victoria.

The ASX200 and All Ords both rose just 0.2 per cent despite almost record gains on Wall Street overnight.

Dozens of close contacts are isolating in Melbourne after being linked to three new cases of COVID-19, which yesterday ended Victoria’s 61-day run of zero locally acquired cases.

It’s believed the cases are linked to the outbreak in NSW.

The Victorian Government took swift action and added further restrictions for people travelling to the state from hotspots in Wollongong and the Blue Mountains.

Afterpay has recovered from a modest fall at the close on Wednesday, rising 0.9 per cent on Thursday morning to $118.6.

Miners also rallied with gold miners Silverlake Resources up 1.1 per cent and Gold Road Resources up 2 per cent. Iron ore company Fortescue Metals was also up 1.3 per cent.

Bottom movers this morning were AUB Group (-1.2pc), AusNet Services (-1.1pc) and medical equipment manufacturer Ansell (-1pc).

Brent crude oil has gained 0.2 per cent to $US51.18 a barrel and iron ore dropped almost 2 per cent to $US159.85 a tonne.

Wall Street gains as optimism grows for greater fiscal support

US stocks rose to just below record levels after US investors bet on a strong economic recovery in 2021 on the back of COVID-19 vaccine rollouts and hopes for more fiscal support.

Near-term expectations of bigger stimulus checks dimmed after Senate Majority Leader Mitch McConnell blocked a quick vote to back President Donald Trump’s call to increase COVID-19 relief checks.

Mr McConnell then introduced a bill that tied the increased $US2,000 stimulus checks with the removal of protections for social media companies and a study on election security.

“It will be hard to get something passed with a lame duck Congress — let the calendar roll over and see what happens there,” said JJ Kinahan, chief market strategist at TD Ameritrade.

“It seems like McConnell is just trying to play kick the can until we get a new Congress in place.”

Optimism over vaccine rollouts was boosted after Britain approved the emergency use of AstraZeneca and Oxford University’s COVID-19 vaccine, which will start being administered on Monday.

That was tempered somewhat by the first known US case of a highly infectious coronavirus variant discovered in Britain that is now detected in Colorado.

“At some point we are going to start to have volatility again that is related to COVID; this is not a story that is going away in the first six months of 2021,” Mr Kinahan said.

The Dow Jones rose 67.6 points, or 0.2 per cent, to 30,403.3.

The S&P 500 gained 4.6 points, or 0.1 per cent, to 3,731.7 and the Nasdaq 26 points, or 0.2 per cent, to 12,876.2.

The S&P 500 index is up nearly 16 per cent on the year, after trillions of dollar in fiscal and monetary stimulus and progress in developing vaccines helped the benchmark index bounce back more than 65 per cent from its March 23 closing low.

The tech-heavy Nasdaq, which was the first among Wall Street’s main indexes to turn positive for the year, is also set for its best yearly performance since 2009, with the majority of gains led by Apple, Facebook, Amazon, Netflix and Alphabet.


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