The US Federal Reserve’s 25 basis point rate hike last week ensured equity markets mostly ended the week in positive territory. The S&P/ASX 200 added 0.4% for the week, nearing its 2017 highs following a strong week for the resources sector. The S&P 500 gained 0.2%. The EURO STOXX 50 gained 0.9% as the Dutch election passed without providing a major shock. Resource sector ETFs (QRE, OZR and MVR) were among the top performers for the week.
The Australian dollar gained 2.2% to end the week above US 77c as the US dollar declined on expectations of a slower pace to upcoming rate hikes inferred from Janet Yellen’s remarks.
Gold and silver gained 2.2% and 3.0% respectively in response to a declining US dollar. Iron ore gained 6.5%.
The Australian ETF market saw inflows of A$30m and outflows of A$4m from domestically domiciled ETFs. The largest inflows were into high yield domestic equities (HVST), global banks (BNKS) and silver (ETPMAG).
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