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The Aussie share market gained 2.6% in the first 30 minutes of trade, (but is now tracking 0.5% lower) fuelled by positive news in Europe as the European Central Bank (ECB) just launched a $750 billion stimulus package. Secondly- the market is rallying ahead of the Reserve Bank of Australia’s 2.30pm decision, with rates expected to be cut to 0.25%. Finally, for quantitative easing to be introduced – to inject new money into the economy to support businesses.
The only sector in the red earlier was the energy sector- as the oil price fell to a new 18- year low of US$22.45. Pressure remains on travel related stocks like Flight Centre (ASX:FLT) down 20%, and Corporate Travel Management (CTD) down 16% with Qantas stoping international flights later this month.
The Aussie dollar also hit a new 17 year low, 57.87 US cents. That’s where it last traded in January 2003. It’s bad for importers and great for our exporters.