US President Donald Trump is now reportedly ordering a review of trade policy before he introduces any tariffs, news that has boosted the Australian dollar, some commodities and the ASX.
The S&P/ASX 200 jumped 50.6 points, or 0.61%, to 8,398 points as of 10.30am AEDT.
Over the last five days, the index has gained 2.03% and is currently 1.37% off of its 52-week high.
Nine of the 11 sectors started the trading session in the green, led by materials with a 0.44% shift up and a five-day gain of just shy of 2%.
Utilities rose 0.17%, industrials edged up 0.07% and energy made a marginal 0.02% advance.
ANZ Senior Economist Adelaide Timbrell says in a research note today (21 January) that the US dollar weakened as a result of the unconfirmed reports that tariffs would not be a central plank of day one executive orders.
Timbrell says Trump has instead ordered agencies to conduct a thorough review of trade policy, what’s behind persistent trade deficits, and unfair trade and currency practices.
“The USD weakened as a result, but the sell-off was limited as markets were closed for the [Martin Luther King Jr Day] holiday,” she says.
“Deputy Chief of Staff, Stephen Miller, indicated at the weekend that the bulk of day one executive orders would address government reform, border security and energy policy.”
Timbrell says the sliding US dollar eased headwinds for the broader commodity complex.
“It also offered a moment of relief to commodity markets which have been concerned about the economic impact of such tariffs,” she notes.
“This comes following data on Friday that showed industrial production and manufacturing activity in China had been buoyed by recent stimulus measures.
“Export driven demand, which would be impacted by US tariffs, was also behind the economic rebound.”
Gold shifted up 0.1% to US$2,708 ($4,319) overnight as a weaker US dollar and lingering concerns over the economic impact of any future tariffs inspired investor safehaven demand buying.
On the ANZ China Commodity Index, precious metals rose 0.3%, industrial metals shifted up 0.2% and the bulk commodities climbed 0.4%.
Lithium miner Liontown Resources (ASX:LTR) and coal producer Yancoal Australia (ASX:YAL) were in the top five on the S&P/ASX 200.
Liontown rose 12.7% to $0.71 following December 2024 quarter results showing a 215% spike in spodumene concentrate production and a 674% surge in revenue despite a 5% drop in the realised price.
Yancoal gained 7.9% to trade at $6.42 early in the session.
At the opposite end of the scale, gold major Newmont (ASX:NEM) edged 0.88% lower to $66.55.
The S&P/ASX200 is Australia’s leading share market index and contains the top 200 ASX-listed companies in terms of market capitalisation, and accounts for about 80% of the country’s equity market. The index is designed to measure the performance of the 200 largest index-eligible stocks listed on the ASX by float-adjusted market capitalisation.
It is recognised as the institutional investable benchmark in the country.
Write to Angela East at Mining.com.au
Images: ASX & iStock
