ASX 200 Index bulls taking the baton towards key resistance

The major US indices fell overnight with investors shifting their money to smaller stocks that stand to benefit more from the easing of coronavirus pandemic restrictions as US states try to restart the economy. The S&P/ASX200 benchmark index was higher by 1% in the day following the Aussi Consumer Price Index. Banks and energy companies are keeping the Australian share market indexes on Wednesday.

Aussie CPI supports the sentiment

Australia's March-quarter Consumer Price Index (CPI) figures, including two of the several underlying measures that the central bank looks at, released by the Australian Bureau of Statistics on Wednesday is out – Australia Q1 trimmed-mean CPI has arrived at +0.5 pct QoQ vs the Reuters poll of +0.4 pct.

More here

• Australia Q1 RBA trimmed mean CPI +0.5 pct QoQ vs poll +0.4 pct

• AUD/USD refreshes seven-week top above 0.6500 after Aussie CP

Meanwhile, the financial and energy sectors have been the top performers mid-week wth the sectoral indexes higher. ANZ was the best performer among the big four banks, with its shares gaining 50 cents, or 5.35 per cent, to $16.54. NAB was the next best up 80 cents, or 5.22 per cent, to $16.12 after losing ground earlier this week following weaker results. Westpac traded higher by 69 cents, or 4.56 per cent, to $15.61 while Commonwealth Bank was up $1.76 or 3.02 per cent to $60.37.

Energy stocks also continued their recovery as oil prices hang into positive territory as we progress through the week. Crude markets saw wild swings in sentiment though overnight.

A somewhat bizarre statement from S&P Global Inc (which runs the benchmark GSCI commodity index) that an unscheduled roll from June WTI was “being implemented based on the potential for the June to [trade] at or below zero as well as a steady decline in open interest” had been implemented hit prices. This arguably drove the June contract down to a low of $10.07 and the June July spread out to -$7.69,

analysts at Westpac explained.

ASX 200 Index moving higher within Fib channel

The ASX 200 is trading sideways within a familiar territory, stuck between the  38.2% Fibonacci level (5470) and the 23.6% Fibo. The bears will be looking for an extension below the COVID-19 lows of 4402. A break higher will extend towards a 50% mean reversion at 5794 ahead of a 61.8% golden ration at 6127.