The Aussie share market is set to kick off its shortest and last trading week of the year on solid footing. The futures are suggesting a lift of 0.5% at the open.
It comes as European markets closed higher on Monday and US equities soared to brand new record highs – for two key reasons. Firstly, US President Donald Trump unexpectedly signed the $900 billion COVID-19 relief bill into law, that includes paying most Americans $600. Secondly, the UK is expected to approve Oxford-Astra Zeneca’s COVID-19 vaccine this week. This is all supportive of stocks and the V-shape economic recovery.
- Oil fell 1% to US$47.70 as supply looks to increase with OPEC to boost output by 500,000 barrels per day in Jan.
- Iron ore rose 0.2% to US$155 – a new high. Expect iron ore majors to continue their charge, like Fortescue Metals (ASX:FMG), Rio Tinto (ASX: RIO) and BHP (ASX:BHP).
- Inversely, expect selling today in Gold stocks as the safe haven came under pressure again, down 0.3% to US$1,877 on US stimulus being rolled out.
What else to watch:
- No economic news today. All eyes will be on local company news.
- Whether or not the US House vote on increasing the $600 payout to Americans to $2,000. It’s not expected go through. But if it does go through, expect down beaten parts of the market to see extra buying.
- UBS increased Fortescue Metals’ (ASX:FMG) buy rating and target price to $24.
- UBS also reiterated CSL (ASX:CSL) as a buy with a $346 target.
- Could be worthwhile looking at travel and tourism companies like Qantas (ASX:QAN) which looks likely to rally once travel restrictions ease. QAN is Buy stock for UBS and Morgan Stanley.
- Resimac Group (ASX:RMC), EMvision Medical Devices (ASX:EMV) and People Infrastructure (ASX:PPE) are all showing bullish charting signals according to Trading Central.