The ASX claws back some lost ground

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Australian stocks slowly started the climb back from the global slump.

They followed Wall Street where, after volatile trading, the S&P 500 closed 0.9% higher and the Dow Jones was up 1.4% after two sessions of steep falls sparked by fears of looming higher interest rates.

On the local market, the ASX200 jumped 1.7% at the open then fell back.

At the close, the index was at 5,876.80, up 43.50 points or 0.75% — about a quarter of yesterday’s falls.

On Tuesday Australian shares followed Wall St deep into the red, with the ASX down more than 190 points, or 3.2%.

Today the big miners were the backbone of the rally.

BHP was up 2.1% to $29.97, Woodside Petroleum 1.75% to $32.60 and Rio Tinto 3.8% to $78.31.

Macquarie Group regained the $100 mark, rising 3.9% to $101.73.

But the other big bags dipped. Westpac was 0.1% lower at $30.59 and the Commonwealth was down 0.79% to $76.79.

AMP Capital says further market jitters, in the form of volatility, could be ahead.

“The US market has concurrently had its worst and most volatile day since 2015, followed by its best day since 2016 despite nothing really happening,” write AMP Capital Co-Portfolio Managers (Income) Dermot Ryan and Tom Young in a note.

“This has mainly been attributed in the popular press from the rise in long-dated bonds. In our view, global growth has been running hot and some in the market have forgotten that this has been facilitated by large amounts of monetary (interest rate and similar) stimulus, which needs to be slowly withdrawn now that sustained economic growth has been achieved.

“Given rates are going to rise in the Atlantic economies over the coming months, we may see further jitters.”

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