Scoreboard: Mellow market

There weren’t any fireworks, but the S&P500 closed at a new record on Friday at 7.00pm (AEST), with the Dow not too far off its own record. In fact, not only were there no fireworks but volumes were at their weakest level for the year. The index kind of just limped along.

Data-wise there was some support, I suppose, with new home sales surging 6.4 per cent in April. Then again, that spike doesn’t even offset the previous month’s fall (-6.9 per cent). That was the major news flow, though. Other than that, it was a weekend of elections in Europe. Far-right parties seem to have done well in European elections, with varying and contradictory views on what that actually means. While in the Ukraine, a billionaire oligarch -- Petro Poroshenko -- looks like he’s going to be the country's new boss. The East didn’t vote apparently, but Porosheckno says he’s in favour of more autonomy for those regions and so Vladimir Putin said he’ll respect the election result.

Equities saw a decent bid on Wall Street, with all the major indexes up about 0.4 per cent -- S&P500 at 1900, the Dow at 16606 and the Nasdaq at 4185. By sector, tech stocks, basic materials and industrials outperformed. Over in Europe, the Dax was 0.5 per cent higher, the CaC rose 0.3 per cent, although the FTSE100 fell 0.4 per cent.

Forex markets pushed the euro down, about 27 pips to 1.3620, while the British pound fell about 50 pips to 1.6824. The Australian dollar didn’t do much in the end. After hitting a low of 0.9217, the unit bounced back to sit at 0.9236. Elsewhere, the Japanese yen is at 101.972.

Rates eased again during Friday’s session, the US 10-year Treasury yield hitting a low of about 2.52 per cent (from 2.55 per cent). From that point, the yield did lift marginally, but only back to 2.536 per cent. The 5-year was down 2 basis points to 1.527 per cent, while the 2-year is at 0.34 per cent. Aussie futures were up 1 tick on the 3s at 97.19 and 3 ticks on the 10s at 96.255.

Commodities saw mixed price action, with precious metals weaker -- gold down about $3 to $1291, while silver fell 0.5 per cent. Elsewhere, we saw copper up 0.8 per cent and crude too pushed higher on WTI -- up 0.6 per cent to $104.5 -- although Brent was flat at $110.

Elsewhere, German GDP was confirmed around 0.8 per cent for the March quarter, with annual growth at 2.5 per cent. It terms of growth drivers, private consumption and investment were strong, as were imports. Export growth was more modest in the first quarter. The German IFO survey, also out on Friday night, wasn’t as positive with the business climate index slipping to 110.4 in May from 111.2. Assessment of current conditions and expectations were weaker. Having said that, the survey itself still points to robust growth.

Markets this week. The SPI suggests it’ll be a fairly quiet start to the week with a whopping three-point rise. There is no data that would shake that up today either here or abroad. Looking further into the week, the Aussie data doesn’t kick off until Wednesday with CBA-HIA housing affordability index at 11am (AEST), which is followed shortly after by construction work done figures at 11.30am (AEST). On Thursday we get HIA’s new home sales series and then private capital expenditure at 11.30am (AEST). All through the mining boom, policy makers have been whining about its end -- most pundits will therefore be looking at non-mining investment. Finally on Friday, we get the RBA’s credit figures.

Looking abroad, US data out includes durable goods orders, S&PCase-Shiller’s house price series, Consumer confidence, the Richmond and Dallas Fed manufacturing indexes, the second estimate of US GDP, jobless claims, personal spending and income and a few Fed speakers -- George, Lacker and Williams.

Have a great day.