Markets up on positive US lead

Australian markets appear set for their second straight day of gains today thanks to a broadly positive lead from the US overnight.

At 12.35pm the S&P/ASX200 is up 2.2% on yesterday’s close to 5532.8, building further on yesterday’s 4.35% gains.

The warmer sentiment in the US overnight was driven by a general view that the US Government is getting closer to finalising a planned $US145 billion rescue package and hopes that the US Federal Reserve could announce an additional rate rise when it meets next week.

Talk of a package to boost monoline bond insurers which have been buffeted by the market volatility also boosted confidence.

After initial selling saw it drop more than 2% in value, and the change in sentiment saw the benchmark Dow Jones index close up 2.5% to 12270.17 overnight, a 298.98 point gain.

Banking stocks including the National Australia Bank and the Commonwealth Bank have been the biggest winners in Australia in trading today.


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