Market surges despite European focus: Afternoon market insights

The Australian sharemarket rose today, following positive overnight leads.

At 3.30pm today, ASX200 was up 0.72% to 4042.0, while the broader All Ordinaries index gained 0.63% to 4081.9.

Tim Waterer, senior trader at CMC Markets, said the market psyche continued to be dominated by the European debt dilemma.

“While it was a better outing for the market, the ASX200 is still on unstable footing,” he said.

“A rare ‘up’ day on the ASX200 made for pleasant reading after a run of outs…. our market followed the same tentative lead provided by Wall Streets, with stocks edging higher but traders not getting too carried away with things.”

The Australian dollar was little changed today, trading just above parity at $US1.00625. Waterer said the dollar was performing better than most ‘risk’ currencies.

“This is mostly due to the fact that domestic economic strength is causing the market to ‘price out’ the likelihood of a rate cut next week. The diminishing expectations of a July rate cut is having an offsetting impact against the negative overall market sentiment,” he said. “This is what is keeping the AUD relatively well supported despite the doom and gloom global picture.”