Another up week, the second in a row for most stockmarkets around the world.
But the big unknown for this week will be the impact of the move by China to allow the Yuan to move rather than peg it tightly to the US dollar.
The American, European and Japanese governments welcomed it, but of greater interest will be the impact on shares and commodities because China is the biggest force in global markets these days.
No one quite knows the impact and where it will fall, but we will see from today if there is any movement in the value of the Yuan.
Everyone is looking for the Yuan to rise (which could impact Chinese share prices).
But the central bank and government spokesman said over the weekend that any appreciation will be modest and depreciation cannot be ruled out if the euro falls sharply against the dollar.
What this seems to be saying is that if there’s any more weakness in Europe with the banking system of weak growth, then the Yuan will most likely weaken as the US dollar firms.
It will be a bit unclear for a few months, but the move by China is a sign that the government sees the financial crunch as having finished, despite the weaknesses in Europe.
It is actually a very positive sign for the global economy, and also a sign of China’s increasing confidence about its financial and industrial strength.
It could trigger another solid week on markets, but watch Shanghai.
It has been weak all year because of fears about the impact of moves to cool the property sector and then economy.
It fell last week and investors will probably sell again this week until they get a lead from somewhere else.
But it should be seen as a positive for the economy, the market, and for countries like Australia.
Wall Street ended up on Friday and up over the week.
The Dow added 0.2% to 10,450.64. The Standard & Poor’s 500 Index rose 0.1% to 1,117.51 and Nasdaq added 0.1% to 2,309.80.
For the week, the Dow and the S&P 500 gained 2.4% and Nasdaq added 3%.
The S&P 500 is down about 8% since a recent high on April 23 after having fallen around 14% at one stage.
A standout Friday were Apple shares hitting an all-time high at the end of a week during which it said it sold a single-day record number of iPhones.
Apple shares hit $US275 during the day’s trading before closing at $US274.07.
Apple reported Tuesday that it had received 600,000 pre-orders for the new iPhone, the most ever in a single day.
Last month, Apple moved past Microsoft as the largest US technology company in terms of market value.
The only US company with a larger market capitalization than Apple is oil giant, ExxonMobil.
European shares rose for a fourth week as concerns about banks and the finances of countries like Spain and Greece eased.
The Stoxx Europe 600 Index added 2.4% to 255.5, the highest closing level since May 13 and the longest streak of weekly gains since April.
The Index is up 10% from its 2010 low on May 25.
Most major European markets finished slightly down on the day Friday, but higher over the week.
Asian markets ended mixed Friday, with Sydney up and Shanghai down.
Tokyo’s Nikkei ended flat, Sydney’s ASX 200 climbed 0.5% and South Korea’s Kospi rose 0.2%.
But China’s Shanghai Composite lost 1.8%, and Hong Kong’s Hang Seng Index was up 0.7%.
The MSCI Asia Pacific Index rose 3.3% last week in its strongest performance of the year so far.
The index is now down 3.6% for the year so far, much better than the 8% fall in the US.
The Nikkei 225 rose 3%, South Korea’s Kospi Index climbed 2.2%, the Hang Seng was up 2.1% and the Taiwan market rose 2.7%. But the Shanghai market fell 2.2%.
Australian stocks rose on Friday and last week.
The ASX200 index was up 24.6 points, or 0.5%, at 4551.9 on Friday for a gain of 1% for the week.
The All Ordinaries index rose 27.1 points, or 0.5%, to 4574.1.
