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.