Major bourses around the globe climbed higher in Donald Trump's first week in office, and the local sharemarket was no exception.
The benchmark S&P;/ASX200 added 0.7 per cent to 5714 on Friday, and 1.1 per cent over the whole week, buoyed by a rally in the materials sector.
During the week, Wall Street indices hit all-time highs, with the Dow Jones topping 20,000 points for the first time on Wednesday. Investors looked past the new US President's protectionist rhetoric to focus on pro-growth initiatives such as tax and regulation cuts as well as the approval of a controversial pipeline project.
Fairmont Equities managing director Michael Gable said some traders had feared the markets would end their bull run after Donald Trump's inauguration. "The fact that they've done the opposite and made new high s has given our market a short-term boost," he said.
"But I think that will start to evaporate over the next week as we start to concentrate on our local reporting season.As we saw with the Brambles profit warning a few days ago we need to be a little cautious holding stocks at elevated levels coming into reporting season.
"The last couple of weeks on the market have mostly been built on all these external factors - Trump and the US market - but we will need to start focussing more domestically. Reporting season is often a minefield of disappointments and misses, and we're starting to see that already."
Leading the gains - not on Friday but over the week - were the big miners as commodity prices continued their surprise resurrection. BHP Billiton added 4.4 per cent, Rio Tinto soared 8.9 per cent as investors cheered the sale of coal assets, while South32 rose 7.1 per cent.
The big banks enjoyed a strong week as their US peers returned to favour on Wall Street, with Commonwealth Bank adding 1.7 per cent and the other three not far behind.
Weighing on the sector were the gold miners, Friday's biggest losers, which fell on the unwinding of the gold price in the second half of the week.
The week's biggest winner among the top 200 was Tassal Group, adding 17 per cent, while the biggest loser was Brambles, down 13.6 per cent after shocking investors with a profit warning early in the week.
Stock watch: Domino's
Sharemarket darling and strong 2016 performer Domino's fell markedly over the week, losing 5.91 per cent to $61.01, but the pizza chain struggled to find a reason for the losses. In early January, the pizza delivery retailer introduced a 10 per cent surcharge on Sundays to help pay for a 25 per cent Sunday loading for drivers and store staff. This led some analysts to question whether this was behind recent price falls. But CEO Don Meij strongly rejected the assertion, telling the ASX on Friday he had seen "no evidence" to support this theory. Domino's is one of the ASX's most expensive stocks. At its $80 peak in August last year, it was trading at 57 times earnings. With recent falls that multiple has shrunk, but remains high. It's now trading at 43 times this year's earnings.
Market movers
Mexican peso
Almost all major currencies - not least the Aussie - posted gains against the American dollar in the first weeks of 2017, with the exception of the Mexican peso. It's fallen 3.25 per cent, and plunged even further on Friday, as the Mexican president cancelled a scheduled meeting with his American counterpart after Donald Trump made renegotiation of the NAFTA trade deal contingent on Mexico paying to build a wall across its north border (one of Mr Trump's key election policies). More than 80 per cent of Mexico's exports go to the United States, leaving the country highly vulnerable to punitive trade embargoes from its northern neighbour.
Gold
The spot gold price fell half a per cent to $US1184 an ounce on Friday, leading to carnage amongst Australia's gold miners, who had been enjoying a bull run of late. The precious metal had been steadily rising since mid-December befo0re abruptly falling this week as the US dollar recovered from a sell-off. "A combination of things including a strong US dollar, thin volumes ahead of the Chinese New Year and weak longs is putting pressure on the market," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong. "Most of Asia is already off for the holidays, which is a good time for many to short the metal ... You can see the bids are very weak, which shows the demand right now."
Export/import prices
The release of fourth-quarter trade prices saw a bit of good news come the market's way: Australia's terms of trade soared 12.2 per cent in the fourth quarter as export prices spiked 12.4 per cent - their biggest quarterly jump in six years thanks to the iron ore and coal rally - while import prices edged up just 0.2 per cent. The release however didn't have a major impact on the Australian dollar, which shrugged off the news. The bonanza is not expected to last - JP Morgan economist Tom Kennedy said increasing iron ore supply and falling coal spot prices should see the terms of trade move lower in early 2017.
Paladin Energy
Paladin Energy surged 31 per cent to 13 cents in heavy trading on Friday, but the uranium miner said it was as baffled as anyone about the jump. In a statement to the ASX, the company said it had no pending announcements, and that it wasn't aware of any of its earlier announcements that could have caused the trading uptick, though it added that uranium market conditions continue to improve. The uranium spot price hovered around $US24 per pound, up about 7 per cent from last week's levels and 39 per cent higher than its recent low in mid-December. Paladin also said it was looking to convene a meeting of shareholders to seek approval for a flagged debt restructure, but that it remained "highly conditional".