Stable start tipped for Aussie market after dollar plunge

THE Australian stockmarket is expected to have a more stable week this week, after international volatility last week caused the Australian dollar to plunge to an 18-month low.

After falling to US72.85● last week, a level not seen since the beginning of 2017, the Australian dollar had rallied by the weekend back above US73●. Commsec economist Craig James said the expectation was that the share market would follow the dollar’s rise.

“The expectation is for a rise of 28 points, and I wouldn’t disagree with that,” Mr James said.

There’s also more hope surrounding the NAFTA trade negotiations between the United States, Canada and Mexico, as well as trade meetings between the US and China.

“A weaker currency tends to be good for our sharemarket because it attracts foreign investors in, but there’s enough in terms of positive fundamentals as well, especially with these trade negotiations underway,” he said. It follows the benchmark S&P/ASX200 index on Friday finishing the week up 10.9 points or 0.17 per cent on 6,339.2, while the All Ordinaries index also finished up 13.6 points or 0.21 per cent to be on 6,426.2. “One market which is a good indicator for our market is the Canadian sharemarket with its mix of financial and mining type stocks and it was up by six-tenths of one per cent,” Mr James said.