US personal income rose by 0.4pct in April, in line with consensus. Personal spending was also up 0.4pct, slightly below the expected 0.5pct increase. The final reading for consumer sentiment in May was 74.3, up from 72.4 in April. But pending home sales slumped by 11.6pct, well short of forecasts of a 1.4pct fall.

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The Group of Eight nations have said that the global economic recovery was becoming more ´´self-sustained´´ and pledged support for a $40 billion aid package to fledgling new Arab democracies in north Africa and the Middle East.

European shares rose on Friday. Financials led the gains on a report by the Financial Times suggesting that Basel III capital requirements would not be as strict as initially thought. The FTSEurofirst index rose by 0.7pct with the German Dax up by 0.7pct and the US FTSE gained 1.0pct.

US sharemarkets closed modestly higher in thin trade ahead of the Memorial Day holiday. While financials led the gains, shares in Marvell Technology rose 11.1pct after the tech company gave an upbeat outlook statement. The Dow Jones rose by almost 39pts or 0.3pct with the S&P 500 up by 0.4pct and the Nasdaq rose by almost 14pts or 0.5pct. Over the week the Dow Jones fell by 0.6pct with the S&P 500 and Nasdaq both down 0.2pct.

US treasuries eased on Friday (yields higher) as equities and commodity markets rose and investors booked profits ahead of a holiday weekend. US 2yr yields were flat at 0.48pct and US 10yr yields rose by 1pt to 3.07pct. Over the week US 2yr yields fell by almost 3pts and US 10yr yields fell by 8.5pts.

The US dollar was weaker against major currencies in European and US trade on Friday. The Euro rose from lows near US$1.4190 to US$1.4300, before ending US trade near US$1.4280. The Euro has lifted to US$1.4330 this morning. The Aussie dollar rose from lows near US106.50c to US107.10c before ending US trade near US106.90c and lifting to US107.25c today. And the Japanese yen lifted from 81.25 yen per US dollar to JPY80.75, ending US trade near JPY80.85 and now near JPY80.75.

US crude oil prices rose modestly on Friday. Weighing on prices were mixed economic reports in the US. But a weaker greenback and firmer equities markets boosted the allure of commodities. The Nymex crude oil contract rose by US36c or 0.4pct to US$100.59 a barrel but London Brent crude fell by US2c to US$115.03 a barrel. Over the week Nymex rose by 1.1pct.

Base metal prices rose between 0.5-2.4pct on the London Metal Exchange on Friday with lead and zinc up the least. Over the week metal prices were mixed. Zinc and aluminium rose more than 5pct but nickel fell 1.9pct and tin eased 0.9pct. And the gold price lifted to near three-week highs with Comex gold futures up by US$13.50 an ounce to US$1,536.30. Gold rose 1.8pct last week.

Ahead: In Australia, the business indicator publication is released. In the US, markets are closed for the Memorial Day holiday.

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