ASX 200 starts off 2021 higher, Bitcoin continues to advance
We look at how the ASX 200 benchmark started off the New Year, as well as Bitcoin’s performance over the last 7 days.
ASX 200 opens 2021 higher
Is the optimism we are currently witnessing the new normal or a mere fad?
2020 was, after all, an incredibly volatile year. But maybe more importantly, will the market forget its difficult lessons?
Despite the vicious volatility of 2020, the ASX 200 opened higher on Monday – as traders and investors continue to look through the issues plaguing markets. The first session of 2021 started slowly, but the index nonetheless ticked higher as the day wore on, trading up 1.36% to the 6,677 point level by 3:21 PM.
By the close of the session, the ASX 200 stood at the 6,684.20 point level.
Amongst all that, iron ore giant Fortescue Metals Group was a strong performer, finishing off the session up 5.85% at $24.80.
While there was no news out on the company, iron ore markets continue to trade at multi-year highs. Fundamentals and speculation has driven futures markets to these fresh highs – with CME’s front-month iron ore futures contract last trading at US$158.15 per tonne.
Elsewhere, the share price of IT service management company Link Administration Holdings (LNK) collapsed 13.51% after the company reported that the takeover proposal from SS&C Technology Holdings had been withdrawn.
SS&C had previously made a bid to acquire 100% of Link Group's shares at a cash price of $5.65 per share. Link traded down to $4.80 per share in response.
Despite that deal falling through, Link’s management noted that it 'will continued to consider all alternatives to maximise value for shareholders. As previously announced, this includes a potential separation by way of demerger of Link Group's interest in Torrens Group Holdings (TGH) (and its core asset, PEXA).’
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Bitcoin continues to break records
Returning to that optimism we touched on at the start, Bitcoin (BTC) – maybe the world’s most well-known alternative asset – has continued to break new highs over the last week, rising 22% in that period to trade above the US$33,000 mark for the first time, at the time of writing.
Bitcoin currently has a market capitalisation in excess of US$600 billion.
Other key cryptocurrencies have joined in this new found bull market, in the last week: Ethereum has gained an astounding 44%, Litecoin has risen 26.98%, Poladot, which now has a market cap of US$9.3 billion, has close to doubled, while Dogecoin, a favourite amongst internet users, has risen 139%.
As IG Market Analyst Kyle Rodda tweeted early Monday, 4 January:
‘For all the fundamental arguments for owning Bitcoin, this is looking a lot like mania now. Weekly chart is face ripping stuff as $BTC closes in on $US34,000 in early trade.’
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