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The ASX 200 is lifting by 2.07 per cent to 5,573.7 at lunch thanks to encouraging Phase One results for a potential US COVID-19 vaccine. This is not only the best daily performance for our market in a couple of weeks, the index is near a 10-week high and is on a three-day winning streak (something which hasn’t happened in two months). This highlights the choppy performance for local shares in recent weeks.

Last night the Dow Jones surged by close to 4 per cent while drug maker Moderna jumped by 20 per cent. The company rose after saying it has had encouraging Phase One outcomes for a COVID19 vaccine. Markets are quick to react to vaccine news, as it would obviously not only go a long way in dealing with the health crisis, but also create confidence in the economic reopening process. Keep in mind vaccine excitement can be quick to fade as Phase two trials have only just begun.

The threat of escalating Australian trade tensions with China remain. China has imposed a 74 per cent anti-dumping duty on Australia’s barley for five-years starting today.

All sectors are lifting at lunch, with gains of around 2 per cent across financials, industrials and retail stocks. Property trusts and miners are up around 3 per cent.

Energy stocks are continuing to stand out for a second day thanks to substantial gains in oil prices. The price of oil jumped by 8.1 per cent last night to US$31.82 per barrel on optimism that the easing
of lockdown restrictions would boost oil demand, reports that China has been ramping up purchases and that a vaccine would help the global economy return to normal.

Gold miners are underperforming as investor appetite for risk is pushing the price of the yellow metal lower. Shares in Newcrest (NCM), Northern Star (NST), Regis (RRL), Saracen (SAR) and Evolution (EVN) are all slipping. Biotechnology company Mesoblast (MSB) is down 8 per cent. This perhaps follows news of a potential COVID-19 vaccine out of the US. Keep in mind that MSB shares have close to quadrupled in price in two months thanks to signs of an effective COVID-19 cell treatment.

Shares in Cochlear (COH) are down 1.8 per cent after the hearing implant maker was denied a request for a rehearing of an appeal in a United States Court of Appeals. COH has been ordered to pay US$280m due to a US patent infringement.

James Hardie (JHX) is up 11 per cent following a solid lift in both earnings and sales over the quarter. The building products company is suspending its dividend until further notice.

2.2bn shares have changed hands so far today, worth $4bn. 757 stocks are up, 360 down and 327 are unchanged.

Published by CommSec