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Australia Market surges after Wall Street's massive gains

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The Australian share market finished higher for straight second day on Wednesday, 25 March 2020, as investors followed Wall Street's major surge overnight after US lawmakers inched closer to approving a stimulus bill to respond to the coronavirus crisis. At closing bell, the benchmark S&P/ASX200 index advanced 262.41 points, or 5.54%, to 4,998.07. The broader All Ordinaries added 252.88 points, or 5.32%, to 5,006.21.

Investor sentiment got a boost from hopes for a massive US stimulus package to counter the impact of the pandemic, as well a deal to postpone the 2020 Tokyo Games until next year. The White House and Senate reached a deal on a gigantic $2 trillion coronavirus stimulus bill early Wednesday stateside.

The massive stimulus is designed to be a lifeline to Americans and their employers until the coronavirus is brought under control and the country finds some semblance of normalcy. The Federal Reserve signaled the gravity of the situation Monday when, in an unprecedented move, it said it would spend whatever it takes to preserve the U. S. financial system.

Markets across the globe, including those of Spain, the U.

K., and Italy, have been reeling from planned, temporary business shutdowns, to mitigate the spread of COVID-19, the infectious disease that is derived from a novel strain of coronavirus, and which has infected 390,000 people globally since it was first identified in December while at least 16,362 lives have been taken.

Banks, miners and industrials helped lead the gains for what were broad based gains. The big four banks all climbed at least 9% with ANZ Bank (ANZ) the standout, jumping 11%.

A 5% pickup in iron ore prices also boosted local players with BHP Group (BHP) advancing 10% with Rio Tinto (RIO) and Fortescue Metals (FMG) both rising more than 5%.

The airliners have also continued their good fortune so far this week. Qantas (QAN) soared another 20% as the national carrier secured more than A$1 billion in debt funding secured against a part of its aircraft fleet. QAN shares are up ~38% this week but still down close to 55% in 2020. Virgin Australia (VAH) lifted 14% even after announcing it would be grounding 125 aircraft as it cuts domestic capacity by 90%. 8,000 or 80% of its workforce will be temporarily stood down to manage costs.

Domino's Pizza (DMP) fell 8% as the pizza chain announced that in accordance with new restrictions in New Zealand, it will close all NZ stores including delivery and takeaway services for at least 4 weeks

CURRENCY: The U. S. dollar index, which tracks the greenback against a basket of its peers, was last at 101.472 after rising from levels below 100 last week. The Australian dollar changed hands at $0.6037 after seeing levels below $0.58 earlier this week.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, March 25 2020. 15:55 IST
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