A big week for most markets, especially in the US where a relief rally saw the best gains in two years and European markets had their best week in a year.

But oil, gold and grains failed to follow: copper was probably the best performed among major commodities.

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Asian markets did well for a second week, while the European and US markets caught up as Greece retreated from centre stage.

The US dollar was easier which didn't help commodities, especially gold which hit a six week low.

In the US, the Dow jumped 168.43 points, or 1.4%, to 12,582.77 by the close early Saturday, our time.

That left it with a weekly gain of 5.4% or 648.19-points.

That was the biggest weekly point gain since a jump of 782.62 points during the week ending November 28, 2008.

(It then resumed falling all the way to the trough in March, 2009!)

The S&P 500 ended the week with a 5.6% gain after rising 19.03 points on Friday, or 1.4%, to 1,339.67,

And The Nasdaq Composite Index added 42.51 points, or 1.5%, to 2,816.03, giving it a weekly rise of 6.2%.

The S&P 500 and Nasdaq had their biggest weekly percentage gains since July 2009.

Australian shares will open higher when trading resumes this morning.

The Share Price Index closed up 48 points to 4634.00 early Saturday morning after the ASX200 tumbled 16.8 points, or 0.4%, on Friday to 4591.2. The All Ordinaries index fell 11.9 points, or 0.3%, to 4647.9.

For the week, the ASX200 was up 1.8%, the best week in three months and second weekly gain in a row.

The Australian dollar ended the week higher despite weaker than expected Chinese manufacturing data. It ended at $US1.0770 in New York early Saturday.

The MSCI Asia Pacific Index rose 2.5% last week, the second weekly gain in a row.

Japan's Nikkei rose 2% last week, South Korea's Kospi Index rose 1.7%, Hong Kong's Hang Seng Index was up 1% and China's Shanghai Composite Index added half a per cent.

Major Asian indexes were mostly weaker during the second quarter. The Shanghai Composite shed 5.7%, Hong Kong's Hang Seng dropped 4.8%, India's Sensex fell 3.1%, the Australian S&P/ASX 200 lost 4.8% and South Korea's Kospi declined 0.3%.

The Japanese Nikkei Stock Average edged up 0.6% after March's earthquake rearranged prospects for the growth in the Japanese economy, with reconstruction efforts expected to provide a boost going ahead.

The MSCI Asia Pacific Index has lost 1.6% this year, compared with a gain of 6.5% by the Standard & Poor's 500 Index and a drop of 0.3% by the Stoxx Europe 600 Index.

In Europe, the Stoxx Europe 600 Index jumped 4.1% to 274.92 in the past week, ending eight consecutive losing weeks.

Bloomberg said National benchmark indexes climbed in all 18 western European markets last week except Iceland.

London's FTSE 100 Index increased 5.1%; Germany's Dax jumped 4.2% and France's CAC 40 leapt 5.9%.

Greece's ASE Index jumped 6.2%, the best since January (naturally?).

The US dollar traded slightly higher Friday, as another measure of consumer sentiment showed a bigger than expected fall, offsetting in part the unexpected rise in manufacturing activity for June.

The dollar index, which measures the greenback against a basket of six other currencies, ended at 74.364, a modest gain from 74.314 late Thursday.

The euro ended around $US1.4508, little changed from $US1.4502 in late North American action on Thursday. It started last week at just over $US1.41.

In commodities, gold ended at its lowest close for six weeks in New York as tensions eased and investors resumed their hunt for yield and increased their tolerance of risk.

Comex August gold futures dropped $US20.20 to $US1,482.60 an ounce on New York Mercantile Exchange, to be down 1.2% over the week.

That was also gold's lowest settlement since May 17, when it closed at $US1,480 an ounce.

Comex silver for September delivery lost $US1.13, or 3.2%, to $US33.71 an ounce.

On the week silver lost 2.7%.

Comex September copper added 2cs, or 0.5%, to $US4.30 a pound in New York.

That took the gain for the week to 4.9% as traders continued to lift their bullishness about possible Chinese purchases in coming weeks to replenish low stocks.

New York West Texas Intermediate oil lost 48c, or 0.5%, to settle at $US94.94 a barrel.

It had earlier traded as low as $US93.45 a barrel, hit by worrying manufacturing data in China and other parts of Asia.

Over the week oil rose 4.2%, after dropping more than 8% over the two preceding weeks.

In London Friday's Brent crude, the benchmark for Europe, eased 71c, or 0.6%, to $US111.77.

Copyright Australasian Investment Review.
AIR publishes a weekly magazine. Subscriptions are free at www.aireview.com.au

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