MORNING REPORT (5.15am AEST)
In US economic data, housing starts rose by 13.2% in April to an annual rate of 1.072 million - well above expectations. Building permits hit 6-year highs. But consumer sentiment eased from 84.1 to 81.8 in May, short of expectations centred on a reading of 84.5.
In China, home prices rose by 6.7% over the year to April, down from a 7.7% annual gain in March.
European shares were generally higher on Friday. The Italian market lifted 1.1% after falling by 3.6% the previous day. And the Portuguese market rose by 0.1% after slumping 2.7% on Thursday. The FTSEurofirst 300 index rose by 0.3% but while the German Dax fell by 0.3%, the UK FTSE rose by 0.2%. Mining shares were lower with shares in BHP Billiton down by 1.5% while Rio Tinto fell by 2.5%.
US sharemarkets rebounded on Friday after solid falls on Thursday. Telecom and consumer discretionary stocks did best. And the PHLX housing market index rose 0.8% in response to solid housing data. The Dow Jones index rose by 44.5 points or 0.3% with the S&P 500 up by 0.4% while the Nasdaq rose by 21 points or 0.5%. Over the week the Dow fell 0.6%, the S&P 500 lost 0.03% and the Nasdaq rose by 0.5%.
US long-term treasury prices fell on Friday (yields higher) in response to firm data on building permits and housing starts and modest gains on the sharemarket. US 2 year yields rose by less than 1 point to 0.363% while US 10 year yields were up by 3 points from six-month lows to 2.52%. Over the week US 2 year yields fell by 4 points and US 10 year yields fell by 14 points.
Major currencies were mixed against the US dollar on Friday over the European and US sessions. The Euro fell from highs near US$1.3725 to lows near US$1.3685, before ending US trade around US$1.3695. The Aussie dollar rose from lows near US93.35c to highs near US93.70c before finishing US trade around US93.60c. And the Japanese yen held between 101.35 yen per US dollar and JPY101.65, before ending US trade near JPY101.52.
World oil prices rose on Friday. Traders watched the situation in Ukraine, mixed US economic data, talks between Iran and Western nations and on-going supply disruptions in Libya. Brent crude rose by US66c or 0.6% to US$109.75 a barrel while US Nymex rose by US52 or 0.5% to US$102.02 a barrel. Over the week Brent rose by US$1.86 or 1.6% and Nymex rose by US$2.03 or 2.0%.
Base metal prices were mixed on the London Metal Exchange on Friday. Aluminium, copper and tin fell up to 0.7% while other metals rose, with nickel up 1.5%. The Comex gold futures quote fell by just US20c an ounce on Friday to US$1,293.40 per ounce. Over the week gold rose by US$5.80 or 0.5%. Iron ore fell by US$2.10 a tonne on Friday to US$100.70 a tonne. Iron ore fell US$2.00 over the week.
Ahead: In Australia imports data is released. In the US, no major economic data is released.
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