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ASX to gain early on vaccine hope

The Australian market is likely to open in the green after promising data for a potential COVID-19 vaccine helped US markets close higher overnight.

The Australian SPI 200 futures contract was up by 22.0 points, or 0.36 per cent, to 6053.0 points at 0800 AEST on Thursday.

US markets rose after biotech group Moderna said a small-scale study showed its experimental COVID-19 vaccine produced high levels of virus-killing antibodies.

The company’s stock price gained and travel companies – which are desperate for an end to the pandemic – also saw their share prices surge.

The US government’s adviser on infectious diseases Anthony Fauci estimates the country could have a vaccine by year-end.

Investor enthusiasm was also boosted by a Federal Reserve survey showing an uptick in US business activity in early July as states eased restrictions to contain the virus.

The Dow Jones Industrial Average rose 0.85 per cent to end at 26,870.03 points, while the S&P 500 gained 0.91 per cent to 3,226.55. The Nasdaq Composite climbed 0.59 per cent to 10,550.49.

Oil prices rose 2.0 per cent after a sharp drop in US crude inventories. Brent crude settled up 89 US cents, or 2.1 per cent, at US$43.79 a barrel.

Meanwhile in Australia today, the market will be focused on employment figures for June. Unemployment rose to 7.1 per cent in May, and economists expect it will tick up to 7.2 per cent.

The federal government is also expected to announce its JobTrainer program. The training and skills package will subsidise courses for people struggling to find work.

The Australian dollar was trading at 70.10 US cents, higher from 70.02 US cents at Wednesday’s close.

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