The Australian share market finished the financial year on a positive note improving by 2.3% for the month bringing the full financial year return to a very healthy 27.8%. This was the best financial year return since 2008 when the market was heavily influenced by stronger bulk commodity prices. Overseas markets were more subdued except for the US where tech stocks roared back to life with the NASDAQ improving 5.5% although the broader market posted a more modest return of 2.2%. European markets were subdued with Europe down just 0.2% and the UK 0.6% weaker.
Bond markets have recovered a lot of ground since the February sell-off as markets were assuaged by central bank comments that the short-term spike in inflation is much more transitory than structural and would not provoke a move to tighten monetary conditions. US 10-year treasuries fell 13 basis points to close at 1.46% and the Australian 10-year bond declined by 19 basis points to finish close to parity with the US at 1.48%. The Australian dollar weakened 2.5 cents against a resurgent U.S. dollar to close just under 75 cents for the first time in several months. Commodities were a mixed bag, iron ore continued to push forward closing 4% higher at $US218 a tonne, gold fell 7% and crude oil strengthened 10% to finish at $US73 a barrel.