Opening Call: The Australian share market is to open higher.
U.S. stocks rebounded as equities trading calmed down from last week’s turbulence. The 10 Year yield ticked down to 1.07%, snapping a two-session winning streak. The WSJ Dollar Index rose to 85.86. Oil prices rose as OPEC+ appeared to hold firm to promised output cuts. Silver prices reached their highest settlement since 2013 as day traders eyed the metal.
Australian Market
Australia’s S&P/ASX 200 recovered some steep early losses to close 0.8% higher amid more data signalling the strength of the country’s housing market. Data showed home loan lending surged to a record in December. The heavyweight materials and financial sectors led gains.
US Market
U.S. stocks rebounded, with major benchmarks recovering some ground following their worst week since October and the online day-trading crowd setting its sights on the silver market.
The Dow Jones Industrial Average rose 0.8%, the S&P 500 gained 1.6% and the Nasdaq Composite climbed 2.6%. The gain in the S&P 500 put the index in positive territory for the year to date.
Stocks had a rocky January, both setting records and getting roiled by day traders using Reddit and social media to coordinate and drive trading of heavily shorted stocks like GameStop. The latter sparked a volatile wave of trading that rocked a number of large hedge funds.
Many of the stocks popular with the Reddit community were down. GameStop fell 31%, headphone manufacturer Koss dropped 45% and Bed Bath & Beyond fell 14%. AMC Entertainment Holdings, however, was up 0.5%.
Commodities
Futures for gold and silver ended sharply higher, with silver scoring its loftiest finish in about eight years.
Dealers attributed recent gains to the spillover of coordinated buying by individual investors gathering on social-media platforms. March silver climbed by 9.3 % to settle at $29.418, after touching an intrasession peak of $30.35.
That marked the highest settlement for a most-active contract since Feb. 19, 2013, and largest one-day dollar gain since July 13, 2011, according to Dow Jones Market Data.
Prices also saw their biggest daily percentage rise since March 19, 2009. Meanwhile, April gold climbed 0.7% to settle at $1,863.90 an ounce.
Oil Futures
Oil futures gained ground, settling up by more than 2%, buoyed in part by surveys indicating that the Organization of the Petroleum Exporting Countries and their allies are sticking closely to their pledge on output curbs.
West Texas Intermediate crude for March delivery rose 2.6% to settle at $53.55 a barrel on the New York Mercantile Exchange. April Brent crude, the global benchmark, added 2.4%, reaching $56.35 a barrel on ICE Futures Europe.
A winter storm blanketing the Northeast and forecasts for a frigid February are boosting natural-gas prices. Natural-gas futures rose 11.1% to close at $2.85 per million British thermal units.
That is 57% higher than a year ago when the weather was uncommonly warm, yet still about 15% below the price to start this heating season.
Forex
Major currencies were weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.2131 to lows near US$1.2054 and was near US$1.2060 at the US close. The Aussie dollar fell from highs near US76.62 cents to lows near US76.12 cents and was near US76.20 cents at the US close. And the Japanese yen fell from near 104.63 yen per US dollar to JPY105.03 and was around JPY104.95 at the US close.
European Markets
European sharemarkets advanced on Monday. The pan-European STOXX 600 index gained 1.2%. Shares of miner Fresnillo jumped 9.0% as the Reddit-fuelled frenzy for highly shorted stocks spilled into silver, which hit an 8-year high. The German Dax index rose 1.4%, despite a 9.6% plunge in German retail sales in December. The UK FTSE index lifted 0.9% with London-listed shares in Rio Tinto (+1.5%) and BHP (+1.8%) both up.
Asian Markets
Earlier Monday, Chinese stocks ended the session higher, recovering from a broad downturn. The benchmark Shanghai Composite Index rose 0.6%. The Shenzhen Composite Index added 1.2%, while the ChiNext Price Index grew 1.0%. Consumer-services providers, such as tourism firms and education operators, led gains.
Hong Kong shares settled sharply higher, snapping a four-session losing streak. The benchmark Hang Seng Index added 2.2%. Chinese tech giants, which suffered some weakness last week, led the upturn.
The Nikkei 225 also ended higher, gaining 1.6%, driven by surges in several companies that posted strong earnings. E-commerce apparel company ZOZO jumped 17% after raising its earnings forecasts.
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