ASX set for flat start, Wall Street rebounds; $A jumps
Calm is returning to Wall Street, and US stocks are rallying on Monday, while oil prices are giving back some of their initial spurts following Israel's attack on Iranian nuclear and military targets at the end of last week.
The S&P 500 was up 0.9 per cent in afternoon trading and on track to reclaim nearly all of its drop from Friday. The Dow Jones was up 322 points, or 0.8 per cent, and the Nasdaq composite was 1.4 per cent higher. They joined a worldwide climb for stock prices, stretching from Asia to Europe.
The Australian sharemarket is set for a flat open on Tuesday, with futures at 5am AEST pointing to a loss of 1 point. The ASX inched higher on Monday. The Australian dollar jumped. It was 0.7 per cent higher at 65.34 US cents at 5.15am AEST.
Israel and Iran are continuing to attack each other, and a fear remains that a wider war could constrict the flow of Iran's oil to its customers. But past conflicts in the region have seen crude prices spike only temporarily. They've receded after the fighting showed that it would not damage the flow of oil, either Iran's or other countries' through the narrow Strait of Hormuz off Iran's coast.
Hopes that the fighting could remain similarly contained this time around helped send oil prices back toward $US70 per barrel on Monday.
A barrel of benchmark US oil fell 1.4 per cent to $US71.93, while Brent crude, the international standard, dropped 1.5 per cent to $US73.12 per barrel. They had both jumped roughly 7 per cent on Friday after the initial attacks.
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Monday's drops for oil prices accelerated following a report from The Wall Street Journal saying Iran has been signaling it wants to end hostilities and resume talks over its nuclear programs.
In another signal of calming worries in financial markets, the price of gold also gave back some of its knee-jerk climb from Friday, when investors were looking for someplace safe to park their cash. An ounce of gold fell 1.2 per cent to $US3411.50.
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