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Early gains tipped for ASX after US rally

Traders can look forward to good early gains on the Australian share market after a broad rally on Wall Street overnight.

The SPI 200 futures contract was higher by 73 points, or 1.23 per cent, to 5,999.0 at 0800 AEST on Thursday.

In the US, a spate of grim economic data was not as bad as economists feared, and recovery continues from the coronavirus pandemic.

A survey from payroll processor ADP said that private employers cut nearly 2.8 million jobs last month but that was much milder than the 9.3 million that economists told investors to expect.

That raises optimism that Friday’s more comprehensive jobs report from the US government may also not be as bad as feared.

Financials, industrials and tech pushed the three major US stock indexes well into the black.

The S&P 500 rose 42.05 points to 3,122.87. The Dow Jones Industrial Average gained 527.24 points, or 2 per cent, to 26,269.89, and the Nasdaq composite rose 74.54, or 0.8 per cent, to 9.682.91.

In Australia, international and retail trade figures for April will be released on Thursday.

The federal government has announced a $688 million HomeBuilder scheme that should help companies in residential construction.

The scheme will offer grants to people who sign contracts to build or renovate their home until the end of the year.

The S&P/ASX200 benchmark index finished Wednesday close to the highs of the day, up 106.5 points, or 1.83 per cent, at 5,941.6 points, while the All Ordinaries index gained 104.8 points, or 1.76 per cent, at 6,064.9.

One Australian dollar was buying 69.22 US cents at 0800 AEST, down from 69.37 US cents on Wednesday.

Demand for iron ore is keeping the dollar hovering around its highest point since January.

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