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Markets finish higher in rare good day

Lucy Dean
·2-min read
SYDNEY, AUSTRALIA - MARCH 13: A man looks at the electronic display of stocks at the Australian Stock Exchange on March 13, 2020 in Sydney, Australia. The ASX200 plunged more than 7 percent in the first 15 minutes of trade on Friday, amid fears over the spread of COVID-19. The Australian sharemarket fall follows the worst day of trading on Thursday, which saw the worst losses since the Global Financial Crisis. (Photo by Jenny Evans/Getty Images)
The ASX200 lifted slightly at the open. Image: Getty

The benchmark S&P/ASX200 finished up 4.17 per cent on Tuesday at 4,735.70 points in a rare day in the green for the local bourse.

The broader All Ordinaries also finished higher, up 4.15 per cent to 4,753.9 points.

The lifted performance came as analysts predict China will implement a jaw-dropping stimulus package to try to support the huge Chinese economy. That package could be as big as US$7 trillion (AU$11.83 trillion), according to reports in the South China Morning Post.

Investors were also told today that they may have oversold large retail companies like Harvey Norman.

In a briefing statement, investment bank Morgan Stanley said investors trying to price in the recession risk likely oversold Super Cheap Auto, Harvey Norman and JB Hi-Fi.

What happened this morning?

The ASX200 has lifted slightly at the open on Tuesday, following moves from the US Federal Reserve to support the US economy.

The ASX200 was up 2.04 per cent at the open at 4,638.90 points, while the All Ordinaries index also rose 1.97 per cent at the open.

The slight bounce comes after the US Federal Reserve announced a slate of new measures to keep the US market moving, including a commitment to continue purchasing assets as part of its quantitative easing measures.
Monday saw Australian markets hit an eight-year low as Prime Minister Scott Morrison brought sweeping closures of businesses into effect.

The Australian dollar was buying 58.47 US cents at 1015 AEDT, up 58.01 from at Monday's close.

What happened overnight?

Wall Street's slide deepened as the rapidly spreading coronavirus forced more US states into lockdown, overshadowing unprecedented moves by the US Federal Reserve to shore up credit across the economy.

After recently cutting interest rates to near zero, the Fed will now lend against student loans and credit card loans, as well as back the purchase of corporate bonds and make direct loans to companies.

Announcement of the extraordinary measures briefly lifted US stock index futures before Monday's trading session began, but the mounting death toll from COVID-19 and a tide of lockdowns more US states quickly sent the main indexes into the red, putting the S&P 500 on pace for its worst month since World War II.

With AAP.

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