The US was closed last night for Memorial Day and the UK for a bank holiday, following profit-taking in the Australian market yesterday. (Available for non-subscribers after 10am)
Been there, done that
One would been forgiven for assuming yesterday’s announcement of a one week lockdown in Victoria, late morning, would have been negative for the stock market, and it was, for all of 15 minutes. The ASX200 then rallied from down -10 points to up 26 by 3pm.
We might argue that lockdowns are a double-edged sword – on the one hand, a week’s loss of business is negative, but on the other, snap lockdowns have proven to be effective so getting on top of this latest outbreak swiftly is actually a positive.
Perhaps we could even suggest another lockdown will steel the RBA’s resolve. Whatever the case, not only did the ASX200 not close in the red yesterday, the futures are up 58 points this morning, with the S&P up a mere 0.1% overnight.
Not much going on in the broad market on Wall Street last night but the GameStoppers are at it again. Dow down -10. (Available for non-subscribers after 10am)
By the Book
I noted yesterday morning that big sell-off days like we saw on Wednesday, for which the trigger was likely one big index sell order that had buyers simply standing aside, are typically followed by a meaningful rebound the next day. The only problem was, the futures were only up 4 points.
But the ASX200 closed up 87, with a bit of a kick from the jobs numbers, and regained the 7000 level.
The jobs numbers were quite the mixed bag.
April saw a net -31,000 jobs lost when a 20,000 gain was expected, which is not good, except that it was part-time jobs that were lost, with full-time increasing 34,000, which is good. The unemployment rate fell to 5.5% from 5.7%, which is good, but the reason both jobs