Dow jumps, Nasdaq over 3000; Good news for the ASX

Who knows if the optimism will hold, but the US markets have clearly shaken off the GFC and are looking to a bright future.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The US markets had a vibrant session overnight Australian time, delivering the strongest day of 2012, with the Dow Jones Industrial Average closing up 1.7%, the S&P 500 up 1.8% and the Nasdaq – not to be outdone – closed up 1.9%.

While the Nasdaq's crossing of the 3,000 point mark is not a big deal, the fact it closed at an 11-year high isn't to be sneezed at. The last time the Nasdaq closed over 3,000 points was on December 11, 2000, just two short months after the Sydney Olympics!

The US banks were the big winners, with both JP Morgan and Citigroup performing well, after the former announced it had passed the US Federal Reserve's 'stress test'. In all 15 of the 19 banks tested passed.

Optimism reigns on Wall Street

Who knows if the optimism will hold, but the US markets have clearly shaken off the GFC and are looking to a bright future.

The US central bank, the Federal Reserve, reiterated its view that US growth would be moderate, and that unemployment remains a concern. In brighter news, the US retail figures released overnight were encouraging, showing the strongest growth in 5 months, and giving further signs of what might be a nascent US consumer awakening.

The Australian ASX SPI futures index pointed to a 1% gain on our market today, as investors took confidence from the US session.

The Dow Jones has now rallied almost 8% since the beginning of the year, with the S&P 500 gaining 11% and the Nasdaq up over 16%. Our market continues to lag – up barely 4.7% since the end of 2011.

If you are looking for ASX investing ideas, look no further than "The Motley Fool's Top Stock for 2012." In this free report, Investment Analyst Dean Morel names his top pick for 2012…and beyond. Click here now to find out the name of this small but growing telecommunications company. But hurry – the report is free for only a limited period of time.

More Reading:

Scott Phillips is a Motley Fool investment analyst. You can follow him on Twitter @TMFGilla. The Motley Fool's purpose is to educate, amuse and enrich investors. This article contains general investment advice only (under AFSL 400691).

More on ⏸️ Investing

A white and black robot in the form of a human being stands in front of a green graphic holding a laptop and discussing robotics and automation ASX shares
Technology Shares

Joining the revolution: How I'd invest in ASX AI shares right now

Advances in artificial intelligence (AI) could usher in a new industrial revolution. Here’s how you can invest in it.

Read more »

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »