MORNING REPORT (5.15am AEST)
In US economic data, the ´´flash´´ services index fell from 55.3 to 54.2 in April. The composite purchasing managers index eased from 55.7 to 54.9 in April. But consumer sentiment rose from 82.6 to a 9-month high of 84.1 in April, ahead of forecasts centred on a result near 83.0.
European shares fell on Friday in response to heightened tensions in Ukraine. Shares in Deutsche Bank lost 2% on a report that it may raise as much as 5 billion euros in capital to meet stress tests and new capital rules. The FTSEurofirst 300 index fell by 0.8%, with the German Dax down by 1.5% while the UK FTSE lost 0.3%. Mining shares were mixed in London trade with shares in BHP Billiton down by 0.3% while shares in Rio Tinto were flat.
US sharemarkets fell on Friday, dragged down by earnings results and investor unease over the situation in Ukraine. Shares in Amazon lost 9.9% on investor disappointment over its earnings result. Shares in Ford Motor lost 3.3% in response to its earnings result. The Dow Jones index fell by 140 points or 0.9% with the S&P 500 down by 0.8% while the Nasdaq fell by almost 73 points or 1.8%. Over the week the Dow Jones lost 0.3%, the S&P 500 lost 0.1% while the Nasdaq fell by 0.5%.
US long-term treasury prices rose for a third straight day on Friday (yields lower) after S&P downgraded Russia´s credit rating. US 2 year yields fell by 2pts to 0.43% while US 10 year yields fell by 2pts to 2.666%. Over the week US 2yr yields rose by 4 points while US 10yr yields fell by 5 points.
Major currencies were mixed in European and US trade on Friday. The Euro held between US$1.3825 and US$1.3850, before ending US trade around US$1.3830. The Aussie dollar held between US92.60c and US92.95c before finishing US trade around US92.75c. And the Japanese yen lifted from 102.38 yen per US dollar to JPY101.96 before ending US trade near JPY102.15.
World oil prices fell on Friday with traders attributing the losses to end-week profit-taking. Traders were watching geopolitical developments in Ukraine and Libya. Brent crude fell by US75c or 0.1% to US$109.58 a barrel while US Nymex fell by US$1.34 or 1.3% to US$100.60 a barrel. Over the week, Brent lost 0.7% and Nymex lost 3.7%.
Base metal prices were generally lower by up to 1.4% (aluminium) on the London Metal Exchange on Friday. But nickel rose by 0.5% and copper rose by 0.2%. Over the week metal prices rose up to 3% (nickel) although aluminium lost 0.8%. The Comex gold futures quote rose by US$10.20 an ounce or 0.8% on Friday to US$1,300.80 per ounce. Over the week gold rose by US$6.90 an ounce. Iron ore fell by US$2.20 a tonne to US$111.00 a tonne on Friday after rising by US$1.00 a tonne the day before. Over the week iron ore lost US$2.30.
Ahead: In Australia the CommSec State of the States report is released. In the US, data on pending home sales and the Dallas Federal Reserve manufacturing survey are issued.
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