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BHP unification, AUD weakens with stronger USD

australian flag painted on a red brick wall

The S&P/ASX 200 rallied on Friday, up as much as 2.3% intraday and closing 2.2% higher at 6988.10, with BHP and CSL leading the charge higher. The gains followed a technical correction on Thursday which saw the index drop more than 10% below its August 2021 high. For the month so far the ASX 200 is down 5.8% and for the week it fell 2.6%.

US futures are rising, indicating  gains when markets open there.

With BHP shareholders voting for unification, the company is set to become a larger part of ASX indices. At the close today, BHP is expected to move from ~6% in the ASX 200 to ~10%, while also reducing the weight of other names in the index. The change produced massive turnover through today's trading session, with analysts estimating around $25bn, as investors trimmed big index names and bought BHP.

The Aussie dollar has weakened against the US dollar. The US dollar index extended gains for a fourth session to trade at 97.2 on Thursday, hovering at levels not seen since June 2020, after stronger-than-expected US Q4 GDP growth reinforced a more hawkish Federal Reserve stance.

The American economy expanded an annualized 6.9% on quarter in Q4 2021, much higher than 2.3% in Q3 and well above forecasts of 5.5%, according to the US Bureau of Economic Analysis.

The Dow Jones was little changed after adding more than 600 points, the S&P fell 0.5%, and the tech-heavy Nasdaq Composite dropped 1.4% after being more than 1.6% higher at session highs.

The Aussie dollar is at US70.26c against the US dollar.

Bitcoin is at $US37,115.

Gold is at $US1798.00 an ounce.

Brent crude oil is trading around $US89.29 a barrel.

WTI crude oil is at $US87.50 a barrel.

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