The Australian stock market was expected to open on a flat note following the US lead as investors wait on passage of US healthcare legislation through the Congress. However the market has opened positively this morning. All sectors are being supported suggesting overall market confidence.
The fact that the S&P 500 index was up 0.4% at one stage last night provides some insight into likelihood that markets will, at least initially, react positively if Congress is able to reach an early compromise and pass new health care legislation. While this may keep alive expectations that the Trump Administration will be effective in getting its economic program passed into law, optimism may be tempered by the fact that the Senate remains a significant obstacle to Trump’s healthcare legislation even it is passed by Congress.
Relief from news that striking workers at BHP’s Escondida mine in Chile are likely to return to work will be tempered by the fact that a resolution to this dispute hasn’t been achieved. Workers have elected to return to work under their existing contract meaning pay conditions under a new contract still need to be negotiated within 18 months