Market update

Equity markets

US stocks were down last week as they experienced the sharpest one day fall in a month amid concerns that the debt crisis in Europe was spreading. Consumer sentiment was also weaker after a warning about the US’s credit rating from rating agency Moody’s. All the major global indices were down with the exception of the Shanghai index which was marginally higher at 0.8 per cent.

Commodities

Commodities were mostly up during the week, with oil (+1.1 per cent), gold (+3.1.per cent), iron ore (+2.0 per cent), nickel (+1.1 per cent), and zinc (+0.7 per cent) all up. Soft commodities such as cotton (-10.9 per cent) and sugar (-1.3 per cent) were down.

Currencies

The US dollar (USD) slid against most major currencies last week following an announcement from ratings agency Moody’s that it was placing the US government’s debt under review for a possible downgrade. The weaker USD, limited bad news from Europe and momentum from solid Chinese growth data helped the Australian dollar (AUD) to trade as high as $US1.0786 last week. It was trading at $US1.06 in early Monday trade