President Trump tries to re-assure Wall Street, after his initial tweet about bombing Syria caused the market to panic. (AP: Manuel Balce Ceneta)
US and European stock markets have rebounded after US President Donald Trump’s clarification over his tweet yesterday about bombing Syria.
Markets at 7:15am (AEST):
- ASX SPI 200 futures +0.3pc, ASX 200 (Thursday’s close) -0.2pc at 5,816
- AUD: 77.55 US cents, 54.48 British pence, 62.91 Euro cents, 83.22 Japanese yen, $NZ1.05
- US: Dow Jones +1.2pc at 24,483, S&P 500 +0.8pc at 2,664, Nasdaq +1pc at 7,140
- Europe: FTSE flat at 7,258, DAX +1pc at 12,415, Euro Stoxx 50 +0.7pc at 3,443
- Commodities: Brent crude flat at $US72.06/barrel, spot gold -1.3pc at $US1,335.07/ounce
Mr Trump said in a tweet on Thursday that a possible attack on Syria could occur “very soon or not so soon at all”, easing fears of confrontation with Russia.
The President has even asked his trade advisers to look at rejoining the Trans Pacific Partnership (TPP), despite withdrewing the US from the trade pact last year.
Wall Street felt reassured about there being no imminent military strikes, and regained its panic-induced losses from the previous day.
The Dow Jones surged 293 points, or 1.2 per cent, to 24,483.
The S&P 500 rose 0.8 per cent, with the best performing sectors being financials (+1.38pc) and industrials (+1.4pc). The index has almost recoupled all its losses from the year to date. Technology was another standout S&P sector, which gained 1.3pc.
Given the Nasdaq is a tech-heavy stock index, its value jumped by 1 per cent by the closing bell.
Facebook was the notable exception in the technology space as its share price fell 1.5 per cent overnight.
However, the social network’s stocks had gained 5.3 per cent gain over the last couple of days as its chief executive Mark Zuckerberg testified before Congress on the social network’s data security.
US earnings season in focus
Market sentiment also lifted over easing tensions between China and the US over an apparently averted trade war, as well as a solid start to earnings season.
“We’re hearing less talk of firing missiles and less talk of trade war,” said Michael Antonelli, managing director of institutional sales trading at Robert W Baird in Milwaukee.
“Earnings are coming up and expectations are high.”
BlackRock, the world’s biggest asset manager, posted a 26.8 per cent rise in first-quarter profit — which surpassed expectations — helped by lower tax rate and higher advisory fees. This drove its share price higher by 1.5 per cent.
Delta Airlines also posted quarterly revenue which beat estimates, and its stocks leapt by almost 3 per cent.
The big banks Citigroup, JP Morgan and Wells Fargo will report their results by tomorrow morning.
Australian market looks set to open higher
The local bourse is set to open higher, following the strong lead from global markets.
In currencies, the Australian dollar is steady at 77.6 US cents, rose to 62.9 Euro cents, but slipped to 54.5 British pence.
In local economic news, the Reserve Bank will release its semi-annual review on Australia’s financial stability this morning.
Gold prices have fallen sharply to $US1,335 an ounce, as global markets rebounded.