You are here

Australia: Shares track Wall Street higher; markets cheer Biden's strong show

rk_ASX_050320.jpg
Australian shares rose sharply on Thursday, tracking Wall Street after Joe Biden emerged as the front runner for the US Democratic presidential nomination with a strong showing in the "Super Tuesday" primary contests.

[BENGALURU] Australian shares rose sharply on Thursday, tracking Wall Street after Joe Biden emerged as the front runner for the US Democratic presidential nomination with a strong showing in the "Super Tuesday" primary contests.

Former Vice-President Biden's pack-leading results powered a bounce-back in US stock markets from Tuesday's declines after investors deemed the Federal Reserve's surprise rate cut to be inadequate to an epidemic that threatens to slow the global economy.

Mr Biden is considered less likely to raise taxes and impose new regulations than rival Bernie Sanders.

Further underpinning sentiment, the US House of Representatives approved an US$8.3 billion bill and the Bank of Canada took cues from other central banks to slash a key interest rate by the most in more than a decade, both steps taken to tackle the economic impact of the coronavirus.

The S&P/ASX 200 index climbed as much as 1.90 per cent and was up 1.6 per cent by 0032 GMT, recovering from a 1.7 per cent fall on Wednesday.

Stocks, which declined in eight of the nine previous sessions amid a coronavirus-sparked global sell-off, gained strongly, with some of the top miners, including BHP BHP and South32, trading higher on their ex-dividend day.

Today's gains are mostly on the back of Wall Street as "(Joe) Biden's show of strength has more or less ensured that Bernie Sanders and his socialist principles are out of the picture and markets are cheering that", said Christopher Conway, a senior investment adviser at Marcustoday.

The ASX Healthcare index advanced up to 2.8 per cent, with blue-chip CSL tacking on around 3 per cent.

Information technology stocks rose as much as 3 per cent, with buy-now-pay-later firm Afterpay and software company WiseTech Global adding nearly 4 per cent each.

Internet services provider TPG Telecom climbed more than 11 per cent after the company raised its fiscal 2020 core earnings forecast.

Also, the competition regulator said it would not appeal a Federal Court approval for the merger of TPG and a unit of Britain's Vodafone Group

All the big four banks gained, so did all the constituents of the ASX Energy index.

Meanwhile, New Zealand's benchmark S&P/NZX 50 index rose up to 2.7 per cent to 11,720.08, with SKY Network Television surging about 10 per cent to be the top percentage gainer on the benchmark. 

REUTERS