Investing.com - The Australian Securities Exchange is projected to commence Monday's trading on a softer note as market participants keenly await the unveiling of the Labor government's third federal budget on Tuesday.
Last week, the S&P/ASX 200 index saw a 1.6% rise, marking the third consecutive week of five-day gains. This upswing was primarily driven by the optimism surrounding China's economy, which led to an increase in oil prices.
Investors are keenly observing a series of domestic and international economic indicators expected to be released this week. These indicators will provide insights into the potential measures the Reserve Bank of Australia (RBA) and the US Federal Reserve might need to implement in order to manage inflation.
Given the persistent inflation rates domestically and internationally, and an entrenched sense of pessimism in the polls, concerns are growing that the RBA may need to resume its tightening measures. The National Australia Bank Ltd (ASX:NAB) is also set to unveil its business survey at 11.30am AEST.
In the US, The Dow Jones Industrial Average added 0.3%, the S&P 500 added 0.2% and the NASDAQ Composite closed flat.
The University of Michigan's initial reading of consumer sentiment for May recorded a six-month low of 67.4, falling short of the 76.0 estimate predicted by economists surveyed by Reuters. Additionally, the one-year inflation expectation rose to 3.5% from the previous 3.2%.
US Treasury yields increased as traders await the critical April inflation data scheduled for release this week to guide their expectations of the Federal Reserve's monetary policy.
On Friday, oil prices dropped nearly $US1 per barrel following comments from US central bank officials suggesting a longer-than-expected period of high-interest rates, which could potentially dampen demand from the world's largest crude consumers.
Conversely, gold prices experienced a rise, leading to their best week in five. The momentum for the zero-yield bullion was primarily fueled by last week's weaker US jobs data, which reinforced expectations that the Federal Reserve might reduce rates this year