Opening Call: The Australian share market is to open higher.
Australia’s S&P/ASX 200 index closed 0.7% higher, completing its longest winning streak of 2022 despite a pull-back in commodity stocks. The benchmark index followed a positive lead by U.S. equities to notch a sixth-straight gain that is its longest run since late December.
Stocks rose as U.S. indexes moved closer to finishing a month in the green for the first time this year. The technology-heavy Nasdaq Composite Index led the major indexes, closing higher by 1.8%. The Dow Jones Industrial Average added nearly 1% while the S&P 500 rose more than 1.2%.
Investors were monitoring peace talks between Russia and Ukraine, which resumed in Istanbul for the first time in two weeks. Ukraine has in recent days signaled an openness to a neutral status as part of a peace deal with Russia. The talks, which concluded for the day, were described by both sides as constructive.
“Today, Ukraine looks better and buyers are back,” said Mike Bailey, director of research at FBB Capital Partners, of stock markets. “Whether it’s true or not, investors are going with what they see in the headlines.”
Commodities
Gold futures ended at their lowest level in almost two weeks as signs of progress in talks between Russia and Ukraine crimped demand for traditional safe-haven assets, including precious metals. April gold fell 1.4% to end at $1,912.20 an ounce on Comex after touching a low at $1,888.30 – the lowest intraday price for a most-active contract since Feb. 25, according to FactSet data.
“This could be a rough week for gold as renewed peace talks rekindle risk appetite,” said Lukman Otunuga, manager, market analysis at FXTM, in a market update. “An appreciating dollar and rising Treasury yields are likely to rub salt into the wound, sending the precious metal on a slippery decline,” he said.
Oil Futures
Oil prices settled lower, with U.S. prices briefly dipping below $100 a barrel for the first time since mid-month, after Russian news reports said officials described talks with Ukraine as constructive. West Texas Intermediate crude for May delivery fell 1.6% to settle at $105.09 a barrel on the New York Mercantile Exchange after touching a low of $98.44.
May Brent crude, the global benchmark, shed 2% to $108.65 a barrel on ICE Futures Europe. Oil prices saw “further downward pressure due to Shanghai imposing a two-stage lockdown,” said Mihir Kapadia, chief executive officer of Sun Global Investments, in emailed commentary. The move sparked worries about crude demand.
Forex
Major currencies were firmer against the US dollar in European and US trade. The Euro rose from US$1.0980 to US$1.1135 and was near US$1.1085 at the US close. The Aussie dollar held between US74.60 cents and US75.15 cents and was near US75.10 cents at the US close. And the Japanese yen rose from 123.80 yen per US dollar to JPY122.05 and was near JPY122.90 at the US close.
European Markets
European sharemarkets were higher on Tuesday on hopes for progress in peace talks between Russia and Ukraine. Automakers rose by 5.9% with banks up 3.8%. The pan-European STOXX 600
index rose by 1.7%. The German Dax index lifted by 2.8% and the UK FTSE index rose by 0.9%. In London trade, shares in Rio Tinto fell by 0.3% and BHP shares fell 0.2%.
Asian Markets
Japanese stocks ended higher, led by gains in auto and tech stocks, as concerns eased over the rising cost of fuel and raw materials. Toyota Motor added 2.7% and medical-information platform operator M3 gained 4.6%. The Nikkei Stock Average rose 1.1%. Chinese stocks closed lower amid concerns over the economic impact of the staggered temporary lockdown in Shanghai.
The government’s zero Covid-19 policy may suggest more city lockdowns could happen if the country’s recent surge in infections continues to rise further, IG said. The Shanghai Composite Index was 0.3% lower, the Shenzhen Composite Index fell 0.6% and the ChiNext Price Index slipped 0.1%. Auto stocks were lower.
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