ASX pushes ahead as Wall Street welcomes COVID stimulus

The Australian sharemarket has lifted on the back of the positive lead from Wall Street, as investors welcomed the passage of the long-awaited $2.3 trillion ($3.03 trillion) COVID aid bill in the US and Britain’s Brexit deal with EU.

The benchmark S&P/ASX 200 was up 45 points, or 0.7 per cent, to 6710 in afternoon trading, marginally ahead of where it started at the start of the year. The Australian dollar has edged up to US75.91¢.

The big banks all posted early gains, with Commonwealth Bank up 1.24 per cent to $84.18 and Westpac rising 1 per cent to $19.75. NAB and ANZ pushed up 0.8 per cent and 0.9 per cent respectively.

Markets have welcomed the passage of the long-awaited US COVID stimulus bill and Britain's Brexit deal with EU.
Markets have welcomed the passage of the long-awaited US COVID stimulus bill and Britain’s Brexit deal with EU.Credit:Louie Douvis

Meanwhile, the big three miners were also in positive territory, with Fortescue Metals Group up 2.2 per cent to $24.13, BHP rising 0.2 per cent at $43.03 and Rio Tinto edging up 0.4 per cent to $115.86.


The local oil and gas majors, Woodside Petroleum and Santos, were also in the black, up 1.5 per cent and 0.5 per cent respectively.

A2 Milk was a big mover in the session, with the infant formula and milk seller’s shares up 3.9 per cent to $11.38, as investors welcomes its Christmas Eve acquisition of New Zealand dairy company Mataura.

The deal is expected to help A2 increase its direct sales into China after its key daigou reseller channel collapsed due to COVID-19, prompting a near half-a-billion sales downgrade earlier this month.

Investors had plenty of good news to pick from, with US and European markets muscling into into near-record territory overnight.

The S&P 500 Index, Dow Jones industrial average and Nasdaq Composite touched all-time highs after US President Donald Trump signed the COVID rescue package, having previously threatened to block the bill which restores unemployment benefits to millions of Americans.

The Dow Jones Industrial Average rose 235.6 points, or 0.78 per cent, to 30,435.47, the S&P 500 gained 36.57 points, or 0.99 per cent, to 3,739.63 and the Nasdaq Composite added 124.46 points, or 0.97 per cent, to 12,929.20.

Meanwhile, European indexes closed broadly higher, helped by more details about the European Union – United Kingdom trade deal as part of the UK’s exit from the trade bloc. Germany’s DAX rose 1.5 per cent, while the CAC-40 in France gained 1.2 per cent.

In commodities, crude prices dropped as the prospect of increased OPEC+ output in the face of weak demand dampened stimulus cheer.

US crude dropped 1.26 per cent to settle at $US47.62 barrel. Brent was last at $US50.92 per barrel, down 0.72 per cent on the day.

Gold reversed its early gains as the US dollar recovered its losses amid the stocks rally. Spot gold dropped 0.1 per cent to $US1,874.00 an ounce.

With AP and Reuters

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