Markets

ASX: Australian shares surge to 11-year high

Written by The ReReport
As seen in the Source link, written by dailytelegraph.com.au on 2019-05-17 13:06:09

The Australian share market has delivered a pre-election gift to investors, surging to an 11-year high on Friday morning.Every sector except for the financials was up more than 1 per cent in the first half-hour of trading, resulting in the ASX’s top 200 company index pushing 1.02 per cent higher to 6,392.4 points.The surge comes a little over a week after global stocks were on the ropes following the ramping up of trade hostilities between US President Donald Trump and China.Many had hoped the trade war between the United States and China was coming to an end, but a brash tweet from US President Donald Trump sent global markets falling, wiping off nearly $2 trillion so far this week.It also ramped up volatility, with the Cboe Volatility Index rising 50 per cent in two days to breach 20 for the first time since January.But this week has been more positive for investors with Wall Street stocks rising for a third straight session overnight.The Dow gained 0.8 per cent to 25,862.68, only about 80 points below the close on May 10 prior to Monday’s sell-off on US-China trade tensions.media_cameraThe Aussie dollar may be in long-term decline. Picture: Joel Carrett/AAPWHAT ABOUT THE AUSSIE DOLLARWeak full-time employment data on Thursday cemented views the Reserve Bank of Australia would be forced to cut rates soon to stimulate the economy.This caused the Aussie dollar to fall yesterday and into today, slipping to be worth 68.87 US cents early on Friday, the lowest since early January when a currency “flash crash” briefly sent the Aussie to 67.43 US cents.The 70 cent level is a crucial one for the Australian dollar. The dollar fell below that level for about nine months during the GFC.Other than the fall in January, there has only been one period in Australian history where the dollar was worth less than US 70 cents for any decent length of time — the early 2000s.Of course, the dollar could be just blipping below 70 and might recover. But if Donald Trump’s trade war continues, we might have to get used to this new low level of the dollar.THE BIG PLAYERS ON THE ASX ON FRIDAYAfter the open on Friday, mining giant BHP was up 1.76 per cent to $38.20, while Rio Tinto was up 2.54 per cent to $101.80 after China’s benchmark iron ore futures jumped to a record high on Thursday.The big four banks were mixed, with ANZ up 0.09 per cent at $26.685, Commonwealth Bank up 0.49 per cent to $73.69, NAB down 0.21 per cent to $24.15 and Westpac down 0.23 per cent to $25.79.Continue the conversation on Twitter @James_P_Hall or james.hall1@news.com.auOriginally published as In the green: Shock ASX surge