To the scoreboard:
- Dow: 24,753.09 -58.67 (-0.24%)
- S&P 500: 2,721.33 -6.43 (-0.24%)
- AUD/USD: 0.7560 +0.0012 (+0.16%)
- ASX200 SPI futures (June contracts): 6,007 (-30)
1. The ASX200 looks set to start the week lower after global markets took more of a risk-off tone on Friday night. In the US, the S&P500 edged lower while lingering political concerns gave rise to sharp declines in Spanish and Italian stocks.
2. Banking stocks led declines in both Spain and Italy, while bond yields rose as allegations of corruption in Spain raised the prospect of early elections. The MIB stock index in Milan has now fallen almost 9% since a right-wing coalition tentatively formed government in early May, and events over the weekend have added even more uncertainty to Italy’s political outlook.
3. Oil was also a big mover on Friday night, as reports that OPEC will increase production to make up for supply shortfalls in Iran and Venezuala saw brent crude fall by more than 3%. And volatility has returned to iron ore markets as prices slumped sharply to end the week.
4. The euro declined to its lowest level since last November as the USD continued its recent momentum. Broader strength in the greenback also weighed on the Aussie, but the AUD is edging higher in early morning trade today ahead of a relatively quiet week of local data.
5. Thursday’s quarterly Capex data is the main release of note in Australia this week, while global markets will mainly be focused on the US with Q1 GDP (second reading), PCE inflation figures and monthly employment data all scheduled. You can find the full calendar here.
6. In crypto markets, where bitcoin was unable to gain momentum in weekend trade with prices still edging back towards $US7,000. And if you missed it last week, this is a great read from BI’s Peter Farquhar about an Australian employment scheme which uses crypto to pay workers in real time.
Have a great week.
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