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Wall St slips on tepid retail sales, inflation data

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The US dollar fell, while US government bonds rallied after tepid data on retail sales and inflation in the US economy rekindled concern that growth won't accelerate to levels economists project. US stocks ended the day mixed, gold erased a weekly loss, and crude stayed below $US48 a barrel.

The S&P; 500 Index fell as Nordstrom became the latest retailer to miss earnings estimates. Small caps retreated 1 per cent in the week, while technology shares edged higher. The greenback pared a weekly gain, while 10-year Treasury yields fell to 2.32 per cent after retail sales in April rose less than forecast and inflation slowed. The Bloomberg Commodity Index rose for a third day, recovering from a 16-month low. European stocks struggled for direction following the biggest drop in three weeks Thursday.

ASX futures edged 6 points, or 0.1 per cent, higher to 5817. The Australian dollar added 0.2 per cent to US73.88¢, ending well below its overnight peak of US74.21¢. In New York trade, BHP Billition added 0.1 per cent, Rio Tinto slipped 0.2 per cent.

Consumer prices rebounded last month, though at a slower pace than expected, while retail sales advanced after an unexpected drop in March. That was enough to bolster the case for Federal Reserve tightening in June, though not enough to ignite stocks or upset bonds. Investors cast a wary eye on Washington, where President Donald Trump escalated his war with fired FBI director James Comey at the same time his cabinet attempted to move forward on trade and regulatory reforms.

Here are key events investors will be watching:

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Here are the main moves in markets:

Stocks

  • The S&P; 500 fell 0.2 per cent to end the week at 2390.67 at 4pm in New York. The index lost 0.4 per cent in the period, the first slide in four weeks.
  • The Nasdaq Composite Index capped a weekly gain with a rise of 0.1 per cent. Small caps in the Russell 2000 Index sank 1 per cent in the five days.
  • The Dow dipped 0.1 per cent; the biggest losers: GE -2.1 per cent, Merck -1.3 per cent, UnitedHealth -0.9 per cent; the biggest winners: Apple +1.4 per cent, McDonald's +0.8 per cent and Visa +0.7%.
  • The Stoxx Europe 600 rose 0.3 per cent to turn in a gain of the same amount in the five days.
  • The MSCI Emerging Market Index rose 0.3 per cent to cap a fifth straight advance, its longest rally since March. The measure climbed to the highest in 11 months.

Currencies

  • The Bloomberg Dollar Spot Index slipped 0.3 per cent. It rose 0.4 per cent in the past five days, the first weekly advance in a month.
  • The yen added 0.5 per cent to 113.289 per dollar, trimming its drop for the week.
  • The euro gained 0.6 per cent to $US1.0929, to pare a weekly decline to 0.6 per cent.

Bonds

  • The yield on 10-year Treasury notes fell six basis points to 2.32 per cent, after retreating three basis points Thursday. That left the rate lower by two basis points in the week.
  • The five-year breakeven rate, which measures the yield spread between Treasuries and Treasury Inflation Protected Securities, fell about 0.06 percentage point Friday, on pace for the biggest drop since June, while the 10-year gauge sank the most this year.
  • Benchmark yields in France, Germany and the UK dropped.
  • Australia's 10-year yield: 2.63 per cent.

Commodities

  • Iron ore for delivery to China's Qingdao port recouped 1.7  per cent to $US61.38 a tonne on Friday, according to Metal Bulletin.
  • Oil's rebound ran out of steam as investors focus on all the production that OPEC can do nothing about. Crude capped the first weekly gain with an advance of 1 cent Friday to settle at $US47.84.
  • West Texas Intermediate rose 3.4 per cent in the week, but is down 11 per cent in 2017.
  • US drillers added oil rigs for the 17th week in a row, according to data from Baker Hughes. Horizontal rigs, the type most often used to extract oil or gas from shale, rose by 8 to 742. Oil rigs rose by 9 to 712.
  • Gold advanced 0.3 per cent to settle at $US1227.70 an ounce in New York for a third straight day of gains. The metal rose 0.1 per cent in the week after touching the lowest level since mid-March on Tuesday.
  • Aluminium rose as China's top state smelter suspends production capacity of intermediate material alumina. London aluminium added 0.9 per cent to settle at $US1891 a ton.
  • Cotton prices jumped to the highest in almost three years amid signs of tightening global supplies and buoyant demand as exports reached a government target in the US, the world's biggest shipper.

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