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ASX tipped to rise following Wall St gains

Shares are expected to rise early on the Australian market after encouraging findings about a coronavirus drug helped US markets finish last week higher.

The Australian SPI 200 futures contract was higher by 95.0 points, or 1.62 per cent, to 5971.0 points at 0800 AEST on Monday.

The likely spritely start will come after Wall Street on Friday was buoyed by confirmation that Gilead Science’s drug remdesivir could reduce the risk of death in severely sick coronavirus patients.

Australia’s Therapeutic Goods Administration has provisionally approved the drug for use.

The data was contained in a late-stage study and helped deflect US investors’ attention from a record rise in coronavirus cases in that country.

That helped the Dow Jones Industrial Average climb 1.4 per cent to 26,075.30, the Nasdaq composite added 0.7 per cent to 10,617.44, while the S&P 500 rose 1.05 per cent, to 3,185.04.

In Australia, investors will be keeping a close watch on on a COVID-19 outbreak in Sydney’s south-west. Nine cases have been confirmed from the Casula suburb, most of these from a hotel.

Melbourne remains in the early stages of a six-week lockdown after outbreaks spread rapidly.

In the week ahead, Chinese economic data is due for release on Thursday and is expected to show a significant bounce in GDP for the June quarter, year-on-year.

AMP Capital chief economist Shane Oliver said this would strongly support demand for Australian commodities.

On the domestic front, jobs data for June will also be published on Thursday. The figures will provide more understanding as to how the economy is responding to the pandemic.

The Australian dollar was buying 69.53 US cents at 0800 AEST, higher from 69.30 US cents at the close of trade on Friday.

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