Live: ASX set to lift after Wall Street rally

Shortly after the Chinese-owned and wildly popular social media platform Tik Tok was shut down in the US it was back online, saved by (still) President -elect Donald Trump’s intervention.

NAB’s Head of FX research Ray Attrill put out a note this morning on the first hours of the new Trump administration as the market pricked up its ears about news of a phone chat Mr Trump had with China’s President Xi ahead of the inauguration ceremony.

In the week ahead, markets will be braced for a potential slew of Executive Orders emanating from the Oval Office following President Trump’s inauguration, which takes place at 4am Australian Eastern Times on Tuesday morning, followed by a speech and then an inauguration party sponsored by none other than Tik Tok – which was starting to go dark on Sunday after the Supreme Court upheld the ban on the Chinese owned social media app, only to start being restored a few hours later after President Trump indicated he will grant a 90 day stay of execution as soon as he takes office, pending a possible sale of its US interests and where Elon Musk is reportedly one interested party.

A source of intra-day FX (foreign exchange) volatility Friday – initially entailing a USD sell-off and helping US equities end the week on a positive note, was a phone call between President’s Xi and Trump (reportedly at Trump’s request) for which Trump said on social media “the call was a very good one for both China and the U.S.A…we discussed balancing Trade, Fentanyl, Tik Tok, and many other subjects”.

Over the weekend, the WSJ reported Trump has told advisors he wants to travel to China after he takes office.

A strong finish on Friday gave Wall Street its best weekly performance since the US presidential election back in November.

The Dow Jones Industrial Average (+0.8%), the S&P 500 (+1.0%) and the Nasdaq Composite (+1.5%) all gained ahead of Monday’s Martin Luther King Junior Day holiday and Donald Trump’s inauguration.

For the week, the Dow rose 3.7%, the S&P 2.9% and the Nasdaq 2.4%.

The gains were not limited to the US with the MSCI global equities index up 0.8% on the day and 2.5% over the week.

European stocks, as measured by the Eurostoxx 600, rose 1.7% for the week, the largest gain since the start of December.

Looking ahead, futures trading has priced in a 0.3% gain on the ASX 200 this morning.

US Treasury yields nudged higher on more solid economic data, this time in housing and the manufacturing sectors.

That pushed the US dollar higher against most major currencies and the Australian dollar fell below 62 US cents.

Brent crude oil slipped 0.6% to $US80.79/barrel but still gained 1.3% for the week as tougher US sanctions on Russian production and distribution tightened supply, particularly to China and India.

Gold was marginally lower, but appears to have regained its mojo, putting on 0.5% for the week and closing above $US2,700/ounce.

Aluminium was the standout metal gaining almost 2% on the London Metal Exchange thanks to stronger demand from China and perceptions of a shortage in supply this year.

Copper edged down 0.5% as traders took some profits off the table after 11 consecutive sessions of price rises.

Iron ore was back in demand on Friday with the benchmark Chinese price up 1.4% to $US104.20/tonne.

Good morning and welcome to another week on the ABC markets and finance blog.

Stephen Letts from ABC business team limbering up for a blow-by-blow coverage of the day’s events, where every post is hopefully a winner, but none should be construed as financial advice.

In short, the ASX looks set to rise around 0.3% on opening after Wall Street enjoyed a strong rally on Friday.

As always, the game’s afoot, so let’s get blogging.