Six-week highs for the ASX

The white dove that appeared on the lips of Fed chairman Ben Bernanke this morning has pushed the ASX to a six-week high.

The ASX hit 4963 in early trade and is currently resting at 4950 +1% after chairman Bernanke almost completely contradicted the Fed minutes with one of his more dovish statements in recent memory - pushing the AUD higher and Asian markets with it.

The ASX is well and truly in the green now for the winter months and looks like being boosted even further as taper talk is thrown into the air. The ASX has been suffering from foreign funds being repatriated, most of which has returned to the US and Japan.

However, with the USD being punished across all pairs, international funds are going to follow back into the ASX over the coming days and should add strong liquid support for our slightly forgotten market.

The drop in the USD has also benefited gold, hitting $1280 - levels not seen in weeks. NCM has taken full advantage of the move in bullion by announcing staff reductions at its Telfer mine site in WA as it scrambles to rein in costs at the troublesome mine. It is only a matter of time before Hidden Valley face a similar fate; with the cost production now finally being addressed and the gold price spiking NCM up 9.35% to $10.88 as the short position in the stock unwind.

The official release of jobs numbers saw the unemployment rate jumping 20 basis points to 5.7% as 4,400 full time jobs were lost.

The fact that employment change increased by 10,300 on 14,800 part-time jobs added, shows the underlying non-mining economy is hurting and that the data is finally catching up to what is being seen on the ground.

This could put a damper on the market’s rise later this afternoon. 

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