Local shares appear set to open little changed ahead of key China manufacturing and US housing data.
What you need2know:
• SPI futures up 10 points to 5390
• AUD at 93.77 US cents, 95.75 Japanese yen, 68.97 Euro cents and 55.08 British pence.
• On Wall St, S&P 500 +0.2%, Dow +0.2%, Nasdaq +0.2%
• In Europe, Euro Stoxx 50 -0.4%, FTSE +0.3%, CAC -0.5%, DAX -0.2%
• Iron ore adds 1.5% to $US92.10 per metric tonne
• LME copper 3-month up 1.4% to $US6820 a tonne
• Spot gold down 0.4% to $US1314.85 an ounce
• Brent oil slips 0.2% to $US114.81 per barrel
What’s on today
China: Flash manufacturing data
US: Existing home sales.
Stocks to watch
Deutsche Bank has upgraded Ansell to a “buy” with a 12-month target price of $22 a share.
Morningstar has issued a “sell” recommendation on Ten Network Holdings after its latest revenue and cost guidance.
Morningstar also has a “sell” on Harvey Norman Holdings.
The greenback held firm on Friday as US bond yields held steady, while sterling slipped from its recent peaks tied to expectations the Bank of England might raise interest rates by early 2015 on signs of a strengthening British economy.
The benchmark 10-year Treasuries yield rose to 2.66 per cent before easing to 2.63 per cent in late Friday New York trading, little changed on the day. The 10-year yield has bounced in a 10 basis point range established two weeks ago.
"Until we get a surprise on the geopolitical front, most major currencies will be tracking bond yields in the near term," Omer Esiner, chief market strategist at Commonwealth Foreign Exchange in Washington, said
Copper futures rose for a sixth session in a row on Friday in their longest winning run this year, backed by a weaker US dollar and tighter physical supply in top consumer China.
LME zinc, which hit an intraday top of $US2182 per tonne on Friday - its highest level since February 18 last year, ended at $US2177 a tonne, up 1.11 per cent. It gained 4.1 per cent for the week, its largest weekly rise since August last year.
On Friday, the S&P 500 scored its third record closing high in a row while the Dow surpassed its previous record close on June 10. The blue-chip index hit an all-time intraday high is approaching the 17,000 mark.
The benchmark S&P 500 has gained for six consecutive days, supporting a cautious view that a near-term correction may be inevitable.
"I haven't been concerned for weeks, but I'm becoming a bit concerned now with where the market is, especially with many indicators hitting levels that are contrary to the normal reading," said Randy Frederick, managing director of active trading and derivatives for Charles Schwab in Austin, Texas.
European shares were mostly lower on Friday, however the FTSEurofirst 300 climbed to a 6-1/2-year high on Friday and recorded its 10th straight week of gains, with analysts saying that expectations of a pick-up in merger and acquisition activity will further boost sentiment.
In London, specialty drug maker Shire leaped 17 per cent to 43.72 pounds after AbbVie confirmed it had made an offer to acquire it. Shire rejected the offer worth 46.26 pounds a share, saying it fundamentally undervalued the company.
“Investors' attention will start to shift from macroeconomic data to the second-quarter earnings numbers,” Robert Parkes, equity strategist at HSBC, said. “We are relatively optimistic on the outlook for European earnings and expect them to grow by 12 per cent this year and the next.”
What happened on Friday
The Australian sharemarket finished marginally higher in a mixed week, buoyed by the biggest one-day gain since December after the United States Federal Reserve reassured investors that it would not raise interest rates in the near term.
The benchmark S&P/ASX 200 Index was brought back to earth on Friday, with losses among the miners and big banks. The index finished the week up 0.3 per cent at 5417.5. On Friday, the ASX 200 slipped 0.9 per cent. The broader All Ordinaries Index also finished the week 0.3 per cent higher at 5401.6. On Friday it fell 0.8 per cent.