ASX200 hits new post pandemic high and flirts with the 7000 level

Asian stock indices mixed, but European and US futures perk-up, ASX200 hits new post pandemic high and flirts with the 7000 level and the US Dollar and UST yields remain at a cross roads; USD/JPY dips.

Although price action in Asian markets has been a little mixed, a general skew towards risk-taking in the region, seemingly underpinned by a pick-up in US and European futures, is injecting a little life into what’s been an otherwise stale for week for financial markets.

Our prices are indicating a reasonably solid jump at the open for both European and US indices – of course, implying a new record high for the US 500 tonight.

Any sort of new flow has been lacking again today – at least in terms of any news that moves markets. The typical narratives are being rolled out, but prices are seemingly moving without much explicit impetus at all.

Clearly, the path of least resistance for stock remains to the upside. While a slight pro-growth skew in FX markets and a lack of bond market volatility is also implying an overall bullish bias in the markets.

The ASX200 has once again been an outperformer today

With the index’s 0.9 per cent rally – at time of writing – pushing it outside of its multi-month range and to new post pandemic highs. The index has also traded above the 7000 level for a period, for the first time since late February 2020. It’s been, perhaps as one might imagine given the breakout, a relatively broad-based rally for the ASX200.

10 of 11 sectors are trading into positive territory currently, paced by large-cap stocks, especially amongst the telecommunications, materials and financials sector, with the defensive utilities sector the only to sustain a modest loss.

In the FX space in particular, the AUD/USD continues to chop about, as the debate continues about trends in US Treasury yields, with some sticking to their guns that some sort of correction in Treasury yields is due. The US Dollar Index remains at something of a crossroads, as the recent stabilization in bond market volatility is yet to be met by buying of pro-cyclical or reflation currencies.

The USD/JPY has extended slightly its recent dip, as a reversal in yields spreads, combined with signs of rollover in price momentum, keeping the pair the purest FX play on US Treasury yield dynamics.

Market participants approach what shapes as another light night for event risk. US Fed Chair Jerome Powell will appear at a virtual conference and address the global growth recovery, while weekly jobless claims numbers will garner some attention.

The key issue, at least to kick-off the overnight session, might just be however whether this nascent bullish impulse manifesting in US and European futures really has legs, or whether we’ll see another lacklustre and low volatility night’s trade tonight.

Want to trade with IG?

Create an IG trading account or log in to your existing account to get started now.

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

Take a position on indices

Deal on the world’s major stock indices today.

  • Trade the lowest Wall Street spreads on the market
  • 1-point spread on the FTSE 100 and Germany 40
  • The only provider to offer 24-hour pricing

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
liveprices.javascriptrequired
liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.