The Australian share market turned around a weak start to the day to close higher, as bargain hunters bought stocks beaten up in Monday and Tuesday’s plunge. The benchmark S&P/ASX200 index was up 0.2 per cent at 5,890.7 points at 1630 AEDT, after falling 0.3 per cent in early trade. The Australian dollar is weaker against the US dollar, which is outperforming all major currencies as commodity prices ease. The local currency was at 78.25 US cents at 1630 AEDT, from 78.77 US cents on Wednesday. Ahead of the local open SPI futures were 104 points lower at 5,708.
The U.S Markets – US stocks have tumbled anew in another trading session with big swings, as investors remain on edge after several days of volatile trading. Major indexes cut their losses somewhat in afternoon trading after falling more than 2 per cent earlier. The benchmark S&P 500 was still set for a second day of declines, following sharp swings in recent sessions including its biggest drop in more than six years that pulled equities away from record highs. The retreat in equities has been long awaited by investors as the market has climbed steadily to record high after record high with few bumps. The recent sharp sell-off was kicked off by concerns over rising inflation and bond yields, sparked by last Friday’s January US jobs report, with investors pointing to additional pressure from the violent unwind of trades linked to bets on volatility staying low. The 10-year US Treasury note yield rose as high as 2.884 per cent, nearing Monday’s four-year peak of 2.885 per cent, after the Bank of England said interest rates probably need to rise sooner than previously expected.
European markets – European shares on Thursday closed in negative territory as volatility made a brutal comeback and ended a short-lived rebound after the beginning of the week’s global sell-off. Europe’s VSTOXX volatility index jumped to 32, its highest since the UK’s Brexit referendum, and all European bourses ended deep in the red. Europe’s STOXX 600 share index fell 1.8 per cent, France’s CAC 40 lost 1.98 per cent to 5,151.68 and Germany’s DAX closed 2.62 per cent lower at 12,260.29. In Frankfurt, growth-sensitive stocks such as Volkswagen or BASF, lost 3.8 per cent and 3.3 per cent respectively.
Asian markets – Asian markets were mixed with Japan and Hong Kong lifting but China fell with its key mainland index sinking to a six month low. Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.25 per cent. Japan’s Nikkei index closed up 1.13 per cent at 21,890.86. Hong Kong stocks regained some composure on Thursday after a brutal sell-off earlier in the week, with the benchmark Hang Seng Index ending the session slightly higher following five consecutive days of losses.