Local shares are set to open lower, despite a late Friday rally on Wall Street, asiron ore continues to plumb fresh recorded lows.
What you need2know
• SPI futures down 34pts to 5883
• AUD at 77.44 US cents, 92.28 Japanese yen, 71.11 Euro cents and 51.99 British pence.
• On Wall St, S&P 500 +0.2%, Dow +0.2%, Nasdaq +0.6%
• In Europe, Stoxx 50 +0.3%, FTSE -0.6%, CAC +0.6%, DAX +0.2%
• Iron ore drops 4% to $US53.14 per tonne
• Spot gold down $US6.26 or 0.5% to $US1198.55 an ounce
• Brent oil down $US2.78 or 4.7% to $US56.41 a barrel
What's on today
Japan industrial production; US personal income, pending home sales; Germany retail sales, CPI.
Stocks to watch
Credit Suisse remains "neutral" on New Hope Corporation and left its target price at $2.50 a share. It said the short term outlook remains challenging for coal but realised prices, expected to decline in 2HFY15, should be partially offset by a lower Australian dollar.
Deutsche Bank has cut crop protection group Nufarm from "hold" to "sell" with a target price set at $6.05 a share.
Trading ex dividened today: Cedar Woods Properties, Freedom Goods, Homeloans, McMillan Shakespeare, Prime Financial Group.
Currencies
Federal Reserve chair Janet Yellen signalled that the US central bank will likely start raising borrowing costs later this year, even before inflation and wages have returned to health, but emphasised the return to normal interest rates will be gradual.
The dollar index, which measures the greenback against a basket of six major currencies, posted its second straight weekly loss.
The US dollar had lost some ground ahead of Yellen's speech on predictions a dovish stance could push it lower. The dollar index rallied over 25 per cent from early May last year through March 17, but has since given back some gains since after the Fed's March 18 statement.
US Treasury Secretary Jack Lew will press Chinese officials in Beijing on Monday to adopt a more market-determined exchange rate policy, and the Obama administration thinks further yuan appreciation would help the global economy.
Commodities
Ore with 62 per cent content at Qingdao, China, lost 4 per cent to $US53.14 a dry metric ton on Friday, according to data from Metal Bulletin Ltd. That's the lowest since at least May 2008, when Metal Bulletin started compiling weekly prices. The drop capped a fifth weekly loss and took declines this year to 25 percent, set for a record drop for a quarter.
Oil tumbled on Friday, erasing the previous session's gains, as Yemen's conflict looked less likely to disrupt Middle East crude shipments and investors turned their focus to talks for a potential Iran nuclear deal that could put more supply on the market.
"The bulls caved after sensing an Iranian nuclear deal might happen by the weekend. Nobody wants to go home long oil on a Friday, with news like this," said Tariq Zahir, fund manager at Tyche Capital Advisors in Laurel Hollow in New York.
The Shanghai Futures Exchange launched its nickel and tin contracts on Friday. A trader said ShFE tin was well below LME prices, cutting the attraction of imports. However, nickel prices were much more closely aligned, suggesting imports may be profitable. A positive arbitrage, or price differential, would encourage imports of nickel and may help put a floor under LME prices.
United States
US stocks rose modestly on Friday and major indexes snapped a four-day losing streak after late news of merger talks in the semiconductor space helped boost the technology sector.
The Wall Street Journal reported chipmaker Intel is in talks to buy rival Altera, citing people familiar with the matter, sending the PHLX semiconductor index up 2.8 per cent. Intel shares jumped 6.4 per cent; Altera shares surged 28.4 per cent.
US consumer sentiment fell month-over-month in March, a survey released on Friday showed, though the decline was smaller than forecast.
The final reading of gross domestic product for the last quarter of 2014 was unchanged at a 2.2 per cent rate of expansion. After-tax corporate profits fell at a 1.6 per cent rate in the fourth quarter.
Europe
Europe's main stock markets have diverged as dealers awaited news on a deal over Greece's finances next week, while also tracking unrest in Yemen.
The FTSE shed 2.38 per cent over the week, the DAX gave up 1.4 per cent and the CAC 1.0 per cent. However, the FTSE still remains up 4.4 per cent since the start of the year, while the ECB stimulus has supercharged the CAC, up nearly 18 per cent, and the DAX by 21 per cent.
Focus remained on Greece on Friday, as Bundesbank chief Jens Weidmann says he is opposed to giving the troubled eurozone country more emergency loans, charging the new government in Athens with frittering away a lot of trust.
Fitch, late on Friday, cut Greece's credit rating to 'CCC' from 'B' saying lack of market access, tight liquidity and uncertainty over the timely release of aid from its official creditors are exerting pressure on government funding.
What happened Friday
Energy stocks were up, but the banks were dumped as concerns about the US economy resurfaced. The S&P/ASX 200 index advanced 40.8 points, or 0.7pc, to 5919.9.
