Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Monday, 27 April 2015

Limit up

6000 here we come...

I've well and truly count of how many times Aussie stocks have flirted with the 6000 barrier in recent weeks.

Stock markets rose again on Monday to a 7 year high (again), recording a nifty 0.8 per cent gain.

The market is now clearly threatening 6000 (again) with the ASX 200 closing at 5982.7.

Today's market was partly driven higher by the rebound in the iron ore price, as well as merger action.

This should help to drive aggregate household wealth to new record highs in Q2 2015.

"Limit up"

Fortescue Metals Group (FMG) closed up by a rip-roaring 16.2 per cent at $2.57 on Monday, having lately rebounded from an utterly desperate 12 month of low of $1.75.

And there could be more to come for FMG as the week rolls on.

Futures markets in iron ore hit "limit up" on Monday, with contracts trading on China's Dalian Commodity Exchange once again soaring 5.21 per cent higher to 434 yuan/tonne.

We can therefore expect to see a spot price of closer to US$60/tonne on Tuesday 

This follows on from a 5.5 per cent jump in iron ore spot prices over the weekend.

The positive market action comes hard upon BHP Billiton's announcement that it would delay reconstruction work at Port Hedland, in turn impacting output targets.

Based on this latest news, there is every chance that the Aussie stock market could breach 6000 tomorrow.



What could possibly go wrong this time...?