Australian shares are set to edge up following gains on Wall Street as local investors eye a historic rate cut and the world holds its breath ahead of the US election.

The Australian SPI 200 futures contract was up 8 points, or 0.1 per cent, to 5,943 points at 8.30am Sydney time on Tuesday, suggesting a positive start to trading.

In the US, the Dow and S&P advanced on Monday while the Nasdaq eked out a gain on the eve of the US presidential election, as investors braced for what could be big market swings after all three indexes notched their biggest weekly decline since March.

The Dow Jones Industrial Average closed up 423.45 points, or 1.35 per cent, at 26,925; the S&P 500 rose 29.94 points, or 0.83 per cent, to 3,299.90; and the tech-heavy Nasdaq Composite was up 46.02 points, 0.25 per cent, at 10,957.61.

Locally, the Reserve Bank of Australia is widely expected to cut the cash rate from 0.25 per cent to a historic low of 0.10 per cent when its board meets on Tuesday.

Investors finished with modest gains on the Australian share market, but that could count for little ahead of a rate decision and US election results this week. The S&P/ASX200 benchmark index finished higher by 23.7 points, or 0.4 per cent, to 5,951.3 on Monday. The All Ordinaries closed up 14.2 points, or 0.23 per cent, to 6,147.4.

Gold was up 0.8 per cent at $US1,892.97 an ounce; Brent oil was up 2.0 per cent to $US38.68 a barrel; Iron ore was up 0.5 per cent to $US118.06 a tonne.

Meanwhile, the Australian dollar was buying 70.42 US cents at 8.30am, up from 70.06 US cents at Monday’s close.


China blue-chip shares finished higher on Monday after a private survey showed the fastest acceleration in Chinese factory activity in nearly a decade, the latest indication of the country’s robust economic recovery from lockdowns.

The blue-chip CSI300 index closed up 0.54 per cent, with the consumer staples sector up 0.24 per cent and the real estate index up 0.47 per cent. The Shanghai Composite index was little changed, closing 0.02 per cent higher at 3,225.12.

Hong Kong stocks kicked off November with solid gains, helped by strength in materials and consumer firms, though traders braced for turbulence during the US Presidential election week.

At the close of trade on Monday, the Hang Seng index was up 352.59 points or 1.46 per cent at 24,460.01. The Hang Seng China Enterprises index ended 1.81 per cent firmer at 9,936.56.

Around the region, MSCI’s Asia ex-Japan stock index was weaker by 1.5 per cent, while Japan’s Nikkei index closed up 1.39 per cent.


Most European stock markets started November on a positive note as accelerating factory activity in the euro zone and China outweighed concerns over a resurgence in covid-19 cases that drove major economies back into a lockdown.

The exporter-heavy German DAX rose 0.7 per cent as a survey showed factories in Europe’s largest economy saw record growth in new orders in October, with data improving in other euro zone economies as well.

Earlier, data showed China’s factory sector activity accelerated at the fastest pace in nearly a decade in the last month.

“China continues to be a bastion of calm in an uncertain world, with economic data delivering once again to calm investor anxieties in what will likely be the second-most anxious week of the year,” Jeffrey Halley, senior market analyst at Oanda wrote in a morning note.

France’s CAC 40, Italy’s FTSE MIB and Spain’s IBEX rose after last week’s sharp losses.

The pan-European STOXX 600 and STOXX 50 indexes failed to show opening prices in morning trading due to “input data problems”, the index operator Qontigo told its clients.

The indexes were back online an hour after the open, up 0.4 per cent and 0.6 per cent, respectively.

The benchmark STOXX 600 logged its worst weekly selloff since mid-June last week, after France and Germany imposed nationwide lockdowns and several other European countries tightened restrictions.

London’s domestically exposed midcap index fell 0.6 per cent after Prime Minister Boris Johnson announced over the weekend that new restrictions across England would kick in after midnight on Thursday morning and last until 2 December.

Pub and restaurant owners tumbled, while shares in British Airways operator IAG, easyJet and Deutsche Lufthansa fell between 0.6 per cent and 4.9 per cent.

Dutch biotechnology company Kiadis soared more than 240 per cent after Sanofi offered to buy the company for 308 million euros ($436 million) to boost its range of immunotherapy products.

British online supermarket and technology group Ocado jumped almost 9 per cent after saying that it would buy two robotics companies and upgraded full year earnings outlook for its joint venture with Marks & Spencer.

North America

The Dow and S&P advanced on Monday while the Nasdaq eked out a gain on the eve of the US presidential election, as investors braced for what could be big market swings after all three indexes notched their biggest weekly decline since March.

Market participants largely expected short-term volatility and the likelihood of major long-term policy shifts related to taxes, government spending, trade and regulation depending on whether Republican President Donald Trump or his Democratic challenger Joe Biden wins the White House race.

Biden is ahead in national opinion polls, but races are tight in battleground states that could tip the election to Trump. Analysts said the outcome most likely to shake equity markets in the near term would be no immediate winner on Tuesday night.

While the Dow and S&P remained on the plus side, they were well off session highs, and the Nasdaq dipped into the red as mega-cap technology and tech-related names continued their slump from the prior week.

Growth stocks shed 0.07 per cent, while the beaten-down value names, which tend to outperform coming out of a recession, rose 1.72 per cent.

The Dow Jones Industrial Average closed up 423.45 points, or 1.35 per cent, at 26,925; the S&P 500 rose 29.94 points, or 0.83 per cent, to 3299.90; and the tech-heavy Nasdaq was up 46.02 points, 0.25 per cent, at 10,957.61.

“If it feels like it is moving more to value and growth is taking a little bit more of a hit, it is telling you the market still expects a Biden win. It doesn’t expect a complete Democratic sweep but it does expect a Biden win,” said Ken Polcari, chief market strategist at SlateStone Wealth LLC in Jupiter, Florida.

Investors betting on a Biden administration, which is expected to deliver a massive fiscal stimulus and promote green energy, have fuelled a rally in solar stocks, industrials and small-cap names in recent weeks.

On the other hand, JP Morgan has listed Bank of America, Wells Fargo and Citigroup in its “Trump basket” of stocks. The S&P banks index added 2.41 per cent.

Energy, materials and industrials enjoyed the sharpest percentage gains among major S&P sectors.

The S&P 500 ended a turbulent week at near six-week lows on Friday, after quarterly reports from technology mega-caps failed to impress and as coronavirus cases surged in the United States and Europe. The weekly percentage drop was the largest since late March, marking the end of a selloff that sent the benchmark index into a bear market, or drop of more than 20 per cent from a high.

The CBOE volatility index, known as Wall Street’s fear gauge, inched lower on Monday after ratcheting up to near four-month highs last week.

Investors will watch this week’s Federal Reserve two-day policy meeting, the monthly jobs report and earnings from about a quarter of the S&P 500 companies.

Clorox Co gained 4.74 per cent after reporting its strongest quarterly sales growth in more than two decades and raising its full-year revenue forecast.

Market research firm Nielsen Holdings gained 3.74 per cent on plans to sell its consumer goods data unit for $2.7 billion to private equity firm Advent International.

The S&P airlines index fell 1.65 per cent, while cruise operators Carnival Corp and Norwegian Cruise Line Holdings Ltd shed 1.39 per cent and 3.27 per cent respectively, reflecting fears over a relentless surge in covid-19 cases.