ASX rallies late to close in black
The Australian sharemarket finished marginally firmer as yield hunting investors shrugged off the slashing in China's GDP growth target.
In quiet trade the S&P/ASX 200 index slipped to a 0.5 per cent loss before climbing to close up 2.6 points, or 0.04 per cent, at 5904.2, with miners leading losses and bargain hunters lifting it off the day's lows.
Dalian iron ore futures tumbled 2.7 per cent after a report from Chinese Premier Li Keqiang delivered would announcing the lowering of China's growth target to "approximately" 7 per cent at the National People's Congress tonight.
Spot iron ore lost 0.5 per cent to $US61.94 a tonne yesterday.
The Shanghai composite index was down one per cent at the close of the ASX on the news.
Westpac economist Huw McKay said the blurring of the line on targets, including money supply growth and inflation, was tantamount to the adoption of a range (his preferred half-way house), which was the obvious precursor to abandoning the target altogether and shifting to a multi-year forecasting framework.
In Tokyo the Nikkei index rose 0.2 per cent.
The Australian dollar was steady at US78.20¢ and government 10-year yields were marginally easier at 2.627 per cent.
Last night the euro tumbled to an 11-year low of 1.1060 against the US dollar ahead of the European Central Bank announcement on the detail of its 60 billion euro a month quantitative easing program due to start this month.
"(The euro) is sliding simply because it has not yet factored in the impact of QE that starts next week," Royal Bank of Scotland currency strategist Greg Gibbs said. "It is far too early to see an end in-sight for the QE policy, notwithstanding recent improvement in European economic data. We continue to see a high probability of a rapid further slide in EUR towards parity in coming months."
More to come…
