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ASX sinks, then recovers after Iran missile strike

Head of Australian sales at UBS in Sydney, George Kanaan believe the market will shrug off the Middle East tensions in the short term.

“However it will be closely monitoring any further developments. Any future actions by either side will be taken much more seriously,” he told Reuters.

Meanwhile Gain Capital market analyst Matt Simpson says the historically high gold price is a good indicator of trader sentiment.

“It is holding above $US1,600 (per ounce). If there is confirmation that there are U.S. casualties, it could go higher,” he said.

“If it does look like we’ve got US casualties, then I don’t think Trump is going to just stand back and take that…World War III has been thrown around. I don’t think we’re there yet. But it does look like Iraq II.”

By the end of Wednesday’s session Wall Street futures had also recovered from a sharp plunge.

On the ASX the biggest gains were enjoyed by Independence Group, which jumped 6.3 per cent to $6.91 after beating second quarter production forecasts. And gold miner Newcrest increased 4 per cent to $32, the highest price in three months.

Qantas shares dropped 3.4 per cent lower to close below $7 for the first time in three months at $6.86.

Qantas shares dropped 3.4 per cent lower to close below $7 for the first time in three months at $6.86. Credit:Mark Metcalfe

The biggest decline was an 8 per cent fall in PolyNovo to $1.87, erasing much of Tuesday’s 11.8 per cent rise, followed by a 5.3 per cent fall in fund manager Pendal Group to $8.54 following a downgrade to ‘underperform’ by Credit Suisse.

Telecommunication companies also posted solid gains on Wednesday. Vocus Group rose 1.75 per cent, to $2.91 while Telstra’s shares inched up 0.81 per cent to end the day at $3.74, and TPG Telecom climbed 1 per cent to $7.

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