United States
US equities ended the week little changed as investors awaited the outcome of tariff talks between the US and China over the weekend. The meeting between US Treasury Secretary Bessent and Chinese Vice Premier He Lifeng took place in Switzerland. On Sunday Mr Bessent said the talks were “productive” and that more details would be forthcoming on Monday in the US
At the close of Friday’s session, the Dow slipped 0.29% (down 119 points) to 41,249. The Nasdaq edged lower by 0.16% (3 points) to 2,023, while the S&P 500 dipped 0.07% to finish at 5,659. The index fluctuated throughout the session, with four of the 11 sectors ending in the red. Healthcare was the weakest sector, falling 1.10%.
Over the week, healthcare fell 2.9% as investor sentiment was impacted by two key developments: the appointment of a new director for the FDA’s Center for Biologics Evaluation and Research, who is expected to take a stricter approach to drug approvals, and reports that the administration is planning to revive efforts to cut prescription drug costs. Eli Lilly fell 2.25% and Merck declined 2.16%.
Overall, major stocks were mixed. Meta fell 0.92%, while Amazon gained 0.51% to close at $193.06. Tesla rose 4.72% to $298.26, supported by optimism surrounding trade negotiations. Expedia declined 7.30% after reporting earnings below expectations and noting weaker-than-expected travel demand in the US. Lyft reported mixed results but announced a $750 million share buyback, leading to a 28% rally in its share price to $16.65. The rebound follows an extended period of weakness for the company.
Walmart declined 0.49% to $96.72, with traders awaiting its upcoming earnings report for signals on consumer behaviour amid the current economic backdrop.
In fixed income markets, the US 10-year Treasury yield was unchanged at 4.38%, while the 2-year yield rose 2 basis points to 3.89%. The upcoming week will feature key economic data, including inflation readings for both consumers and producers, along with retail sales figures.
Europe
European and UK equities advanced on Friday, supported by rising expectations of further trade agreements. The Euro Stoxx 600 rose 0.44%, or 2.33 points, to close at 537.96, while the FTSE 100 gained 0.37% to finish at 8,554.80. In Germany, the DAX index climbed 0.63% to close at a record high of 23,499.
Sector performance across the Euro Stoxx 600 was broadly positive, with 10 of the 11 sectors finishing higher. The energy sector led the gains, driven by a 4.73% surge in BP shares following a Financial Times report that Shell, Chevron, ExxonMobil, TotalEnergies, and ADNOC have all “run the numbers” on a potential takeover bid for British Petroleum.
Automakers also performed strongly after a tariff deal was reached between the UK and the US, with Switzerland expected to follow suit. BMW rose 1.8%, while Renault added 2.2%.
Banking stocks gained after better-than-expected earnings results from Commerzbank and Mediobanca, which surprised investors on the upside.
Bond yields moved higher across the region. The German 10-year Bund yield rose by 3 basis points to 2.56%, while the UK 10-year gilt yield increased by 1 basis points to 4.56%.
In a speech on Friday, ECB member and Finnish central bank governor Olli Rehn said that efforts to bring inflation below 2% remain on track. However, he warned that the broader economic growth outlook in Europe is deteriorating.
Australia
The Australian equity market is expected to open the week on a mildly positive note, with ASX 200 futures up 16 points, or 0.19%, in evening trading. Meanwhile, the AUD/US$ has rebounded to 0.6414 after three consecutive days of declines.
On Friday, the ASX 200 advanced 39 points, or 0.48%, to close at 8,231.20. Gains were broad-based, with 9 of the 11 sectors finishing higher, led by strength in financials and technology.
Financials outperformed, driven by a strong result from Macquarie Bank, which reported a 5.5% rise in net profit. While net interest margin and trading revenue declined, this was offset by an 8.7% increase in fee and commission income. Macquarie also announced a lift in its final dividend to $3.90 per share. The stock surged 3.79% ($7.42) to close at $203.31, additionally supported by broader optimism around potential tariff agreements.
Elsewhere in the sector, Westpac recovered 2.33% to $31.21 after a four-day post-earnings slump, while QBE Insurance gained 3.48% to $22.59 after reporting a 7% rise in gross written premiums for the first quarter and reaffirming its full-year outlook.
Technology was the best-performing sector, up 1.83%. A positive lead from U.S. markets helped lift NextDC by 2.65% to $13.57, following several brokers upgraded the stock last week. Megaport also rallied, climbing 3.91% to $11.68.
In corporate news, Domain Holdings reached a binding agreement with CoStar Group for the acquisition of all its shares. Domain shares rose 3.06% to $4.38, while major shareholder Nine Entertainment added 6.04% (9 cents) to finish at $1.98. Conversely, REA Group fell 2.04% to $244.97 despite delivering strong third-quarter earnings with double-digit growth. The decline was attributed to the valuation premium REA holds relative to the Domain-CoStar transaction.
In fixed income, Australian government bond yields moved higher, with the 10-year yield up 1 basis point to 4.28%, and the 2-year yield rising 5 basis points to 3.37%. Traders will be closely watching employment data and inflation expectations due Thursday, ahead of next week’s RBA meeting on interest rates.
Commodities
Oil continued its rebound from multi-year lows last Monday, ending the week with a gain of approximately 2%. On Friday, West Texas Intermediate (WTI) rose 1.85%, or US$ 8.41, to close at US$61.02, while Brent crude gained 1.70% (US$1.07) to settle at US$63.91.
Sentiment was boosted by renewed optimism around global trade. The U.S. struck a deal with the UK, and President Trump’s comment that an 80% tariff on China “seems right” fuelled expectations that further trade agreements could follow shortly. Adding to the bullish tone was the news that the number of active U.S. oil rigs fell to its lowest level since January—signalling supply tightening amid lower price conditions that forced some producers to halt operations.
Base metals also gained, led by copper, which rose 0.15% to close at US$9,445.50 per tonne on the London Metal Exchange. Tighter international markets and steady copper import data from China—defying expectations of a decline—supported the move. Iron ore saw more modest movement, closing at US$ 97.45 in New York, up 52 cents.
Precious metals were firm as geopolitical tensions, and a weakening U.S. dollar spurred safe haven buying. Gold rose US$19.26 (0.58%) to end the day at US$3,324, capping a 2.5% gain for the week. Heightened tensions between India and Pakistan, combined with another 0.24% drop in the Bloomberg U.S. Dollar Index on Friday, contributed to the upside. Silver also advanced, adding 0.80% to settle at US$32.72.
Cryptocurrencies continued to rally with Bitcoin trading at US$104,290, marking a 1.8% gain from early Friday. The move was supported by large inflows into cryptocurrency ETFs. Ethereum also increased to US$2,505. Ethereum has had a large rally since Thursday following the successful implementation and upgrade of its system called Pectra. This upgrade aims to enhance the network’s scalability, reduce transaction fees and improve security.
Economic Calendar
No major economic data to be released.
This article was written by Paul Darwell, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3632.
