FTSE 100 to backtrack after vaccine blowout, Dow Jones hits new all-time high

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The FTSE 100 is heading for a bit of backtracking on Tuesday morning after making more gains on positive coronavirus vaccine news.

London’s index of blue chips has been called 25 points lower by spread-betters on the IG index, having finished almost 105 points higher at 6,421.29 the day before.

Overnight, Wall Street’s main indices all closed higher, with the Dow Jones hitting its first all-time high since February, climbing over 470 points or 1.6% to 29,950.44.

The broader S&P 500 rose 1.2% and the tech-fuelled Nasdaq Composite added 0.8%.

The change in outlook and market sentiment has been “more than palpable”, said market analyst Michael Hewson at CMC Markets, noting that pessimism about a Covid exit strategy has “transformed into unbridled optimism, that we have a pathway to recovery, and multiple possible vaccine candidates”.

“Despite this unbridled optimism it is also impossible to ignore the current backdrop to the vaccine news, which is seeing a continuation in the trends of rising infection, hospitalisation and mortality rates, across Europe and the US.”

Indeed, the all-time high for the Dow came despite confirmation of an average of 155,442 COVID-19 cases per day over the past week, an increase of 82% from the average two weeks earlier.

California was the latest US state to reverse plans to open up its economy, pulling a state-wide “emergency brake” amid a surge in cases. 

“The situation in the United States is particularly worrisome, with new state-wide restrictions seemingly every day,” said Jeffrey Halley at Oanda.

“The election stand-off is complicating the picture, and it seems inevitable that US economic data will suffer into Q4. America matters as 25% of global GDP.”

Around the markets

Pound up 0.1% at US$1.3215 

Brent Crude Oil up 0.8% at US$44.17

Gold down 0.1% at US$1,887.63

6.45 am: Early Markets: Asia / Australia

Asia-Pacific markets were mixed today as vaccine hopes once again lifted Wall Street to record highs overnight.

In Japan, the Nikkei 225 gained 0.42% after touching a 52-week high on Monday while Hong Kong’s Hang Seng index was flat.

China’s Shanghai composite dipped 0.50% and South Korea’s Kospi was down 0.10%.

Over in Australia, the S&P/ASX 200 gained 0.2% to close at 6498.2 points. This is the highest close since February 27, 2020.

Proactive Australia news:

Nexus Minerals Ltd (ASX:NXM) has received commitments to raise around $6.6 million through the issue of new fully paid ordinary shares at 15 cents per share via a single tranche placement to sophisticated and professional investors.

Polarx Ltd (ASX:PXX) has secured more favourable amendments to the terms of its option to acquire an 80% interest in the Caribou Dome copper deposit in Alaska USA and (a 90% interest in the adjacent Senator property (collectively the Caribou Dome Project).

Roots Sustainable Agricultural Technologies Limited (ASX:ROO) has initiated a pilot trial to test the effects of root zone heating of grapevines using its proprietary Root Zone Temperature Optimisation (RZTO) technology.

Tietto Minerals Ltd (ASX:TIE) has commenced a new diamond drilling campaign at its 3.02 million-ounce Abujar Gold Project in Côte d’Ivoire, which is designed to underpin 2021 gold resource growth and a definitive feasibility study (DFS) on its proposed large‐scale open-pit mining.

Galileo Mining Ltd’s (ASX:GAL) latest results from a large program of ongoing electro-magnetic (EM) surveying surrounding the Lantern Prospect in the Fraser Range region of Western Australia has uncovered a large and strong conductor.

Infinity Lithium Corporation Ltd’s (ASX:INF) ongoing feasibility study test-work for its San José Lithium Project in Spain is yielding positive technical improvements, putting the company a step closer to producing battery-grade lithium hydroxide.

Fe Limited (ASX:FEL) (FRA:B4T) is making steady progress as it drives its advanced high-grade iron ore projects – JWD West Wiluna and Yarram – towards near-term production.

Mako Gold Limited (ASX:MKG) believes its Tchaga prospect in Cote d’Ivoire has the makings of a significant gold discovery after revealing a new shallow, high-grade gold zone, with assays of up to 143 g/t gold.

Core Lithium Ltd (ASX:CXO) focused on enhancing the value and potential of its fully-owned Finniss Lithium Project in the Northern Territory over the September quarter as it drives the project toward a final investment decision by mid-2021.

Brookside Energy Ltd (ASX:BRK) has provided an initial prospective resource estimate of 11.606 million net barrels of oil equivalent (BOE) for its holdings in the SWISH AOI, in the SCOOP play of the world-class Anadarko Basin in Oklahoma, USA.

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