The tentative Iran war ceasefire looks to be holding for now but investors took their profits off the table in case disaster strikes over the weekend.
That ended a somewhat unlikely three-week rally as a bit of caution finally crept into markets across Asia, although the 0.2% fall for the week was far from catastrophic.
On Friday the ASX 200 fell 8.10 points, or 0.1%, to 8946.90 points, although different sectors went in different directions, with six of the 11 sectors falling.
Tech shares defy the gloom
Technology kept heading upwards, adding an amazing 13% for the week with Friday trade alone seeing WiseTech Global shares (ASX: WTC) adding 2.9% to $46.18 and NextDC shares (ASX: NXT) up 1.6% to $14.12.
Shares in financial services group Zip (ASX: ZIP) raced up by 13.7% to $2.33 after it upgraded full-year earnings guidance, as US transaction volumes and revenue rose an impressive 43% in the third quarter.
Retailers and gold miners feel the pain
It was a tale of two markets though, with the tech boom failing to fire up other sectors such as retail and gold.
Retail shares were hit hard after broker reports warned that high fuel prices and rising interest rates would cause shoppers to shut their wallets and would depress earnings for at least a year.
Harvey Norman shares (ASX: HVN) fell 3% to $4.57 and JB Hi-Fi shares (ASX: JBH) dropped 0.5% to $76.07 after both were tipped to suffer solid earnings downgrades.
Other retailers were hit as well with Wesfarmers shares (ASX: WES) down 1.6% to $72.85.
The gloomy sentiment also extended to the gold miners, despite the price of bullion firming during the week.
Evolution Mining shares (ASX: EVN) fell 2% to $13.58, Northern Star shares (ASX: NST) dropped 2.2% to $23.76 and shares in Catalyst Metals (ASX: CYL) fell 5% to $6.43.
Lower oil price weakens energy stocks
Oil prices continued to drop below US$100 a barrel as the chances for a continuing ceasefire in the Middle East improved.
Shares in Woodside Energy (ASX: WDS) erased 0.2% to $32.73 and Ampol shares (ASX: ALD) lost 0.8% to $32.93.
Even some of the once bulletproof banks felt some pain with National Australia Bank shares (ASX: NAB) down 2% to $42.55 and Westpac shares (ASX: WBC) falling by 0.7% to $39.73.
Not all of the banks were lower with Commonwealth Bank shares (ASX: CBA) up 0.1% to $178.23 and ANZ shares (ASX: ANZ) up 0.5% to $37.92.
Shares in Paladin Energy (ASX: PDN) rose 2.8% to $14.54 after the company upgrading production guidance for its Langer Heinrich uranium mine.
The week ahead
US corporate earnings will be front and centre in the coming week as investors look to improving profits and more certainty around an end to the Iran war to justify the recent record highs on the S&P 500 and Nasdaq.
One of the contributors towards those records were a strong recovery in software shares which have risen 12% from the end of March after earlier being pummelled over artificial intelligence (AI) worries.
US semiconductor shares such as NVIDIA, Broadcom and Micron have all been rallying strongly as they fuel the AI rollout with the US semiconductor index now up more than 100% over the past year.
Some of the companies reporting first quarter results this week include United Airlines, 3M, GE Aerospace, UnitedHealth Group, Tesla, AT&T, Boeing, Philip Morris, IBM, American Express, Blackstone, Gilead Sciences, Intel and Procter & Gamble.
The US will also release some economic data, with retail sales for March out on Tuesday expected to show a 1.2% month-on-month rise.
New US Fed chair set to testify
The US Federal Reserve Chair-Designate, Kevin Warsh, is due to testify on his nomination before the Senate Committee on Banking, Housing, and Urban Affairs, so investors will be watching for any views he expresses on the outlook for economic growth, inflation, and interest rates.
It is a quiet week in Australia with the main action being a host of ETF dividend payments which might create some buying pressure from newly cashed up investors.
