Offshore markets will make a tentative start late today after Friday’s less than inspiring end to the week.
Eurozone shares fell 0.5% on Friday and the US S&P 500 lost 0.3% as geopolitical worries (Iran and China) and rising bond yields continue to surprise and worry US investors.
The loss came at the end of a week where Japanese and Chinese shares closed up 0.8% and with Australian shares up 0.5%, but Eurozone shares ended flat thanks to a fall in Italian shares as a populist rightwing government prepares to take power and US shares were down 0.5% on the back of rising bond yields and geopolitical worries.
Oil prices rose but gold sold off sharply (the biggest weekly fall in seven months or so), while copper and iron ore prices fell slightly. A further rise in the $US weighed on the $A which ended just above 75 US cents and not looking all that handy,.
Meanwhile the S&P 500 finished in the day in loss territory and saw its steepest weekly drop in six weeks. The S&P 500 was off by 0.3% on Friday to end at 2,712.98 and lost half a per cent over the week.
The Dow was little changed on the day at 24,715.09 leaving it with a five-day loss of 0.5, its worst week in three.
And the Nasdaq fell 0.4% on the day to 7,354.34 taking the weekly loss to 0.7% — its worst since early April.
Financials, utilities and real estate took hits to varying degrees in the wake of the US 10 year bind yield past the 3.1% mark during the week.
While financials lagged behind the broader S&P 500 on the day, it was bond proxy sectors that were the biggest losers this week amid a run-up in bond yields that saw the yield on the 10-year briefly push past 3.1 per cent.
But the small-cap benchmark Russell 2000 index rose 2 points to 1,627.24, a gain of 0.1% that took it to its third straight record close.
The index has risen in 11 of the past 14 sessions, and it rose 1.3% last week.
That was its third straight positive week, its longest such streak since January and a sign that investors aren’t that worried about interest rates.
