By Andre Botha, Senior Dealer, TreasuryONE
Market expectations of concerted central bank stimulus saw equity and currency markets recover last night and this morning. The RBA announced a 25 basis point rate cut this morning, taking Australian interest rates to a new record low of 0.5%. Wall Street rebounded sharply last night with the S&P up 4.60%, the Nasdaq up 4.49% and the Dow 5.09%. Asian stocks, barring the Nikkei, are also in positive territory but off their highs of the day. The JSE All-share gained 1.57% yesterday. US futures have just turned negative so we wait to see if there will be a further recovery on markets.
The Rand, which had spiked to 15.8900 in the early hours of yesterday morning, rallied sharply in New York to close at 15.3675 and is currently trading a touch softer at 15.4450. The Euro remains firm at 1.1152 while the Pound is at 1.2780.
Precious metals are all trading firmer than yesterday’s closing levels with Gold at $1 598.50, Platinum at $876.60 and Palladium at $2 562.50.