Global equities declined last week as monetary policy expectations were re-aligned following hawkish comments from central bankers across the globe.
- The S&P/ASX 200 declined by 1.7% on Friday to end the week up 0.1%, following an earlier rally in commodities. The S&P 500 declined 0.6%, while the EURO STOXX 50 dropped 2.9% as European inflation disappointed. Resource sector ETFs (QRE and OZR) were the top performing equity funds for the week, while gold miners (MNRS and GDX) were amongst the poorest performers.
- The Australian dollar ended the week close to 3 month highs, nearing US 77c on general US dollar weakness. The euro gained 2.1% against the US dollar as the ECB hinted at tighter monetary policy.
- Global bonds sold off, with US 10 year Treasury yields up 0.16% and Australian 10 year government bond yields up 0.23%.
- WTI crude rebounded 7%, while iron ore gained 14.5%, sending resource stocks higher.
- The Australian ETF market saw inflows of A$116m and outflows of A$58m from domestically domiciled ETFs.
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