Local shares weighed down by energy and materials
The local market has finished slightly lower for a fourth straight session, this time amid weakness in the energy and material sectors.
The benchmark S&P/ASX200 index on Friday finished down 4.8 points, or 0.07 per cent, to 7,256.
The broader All Ordinaries was down 3.5 points, or 0.05 per cent, to 7,453.
The market made mostly small moves throughout the week despite the big news around the federal budget and US inflation data.
Despite the four-day losing streak the ASX200 finishing the week 0.5 per cent higher, thanks to a 0.8 per cent gain on Monday.
"It was a quieter week in financial markets. Issues around the banking sector have again faded into the background, but its too early to say that they are completely resolved," said AMP Australia senior economist Diana Mousina.
In the US, negotiations regarding the US debt ceiling are progressing with US President Joe Biden hosting a White House meeting.
Ms Mousina said while there was no outcome from the meeting, talks between the policymakers are expected to continue, which is positive.
Overnight the Bank of England hiked interest rates by 25 basis points, as expected, while in China, consumer price index data showed inflation there rising by 0.1 per cent.
China does not have an inflation problem like the major advanced economies, Ms Mousina added.
Corpay currency strategist Peter Dragicevich warned that markets have become too optimistic regarding how far and fast inflation might slow from here.
"Barring an exogenous shock - which would also be quite a negative for risk markets and the Australian dollar - we don't think the market's current outlook for the US Federal Reserve is consistent with historical trends and US' underlying inflation dynamics," he said in a statement.
"Risks are skewed to markets being caught out and for aggressive US Federal Reserve rate cut bets to be pared back over the period ahead."
Eight of the ASX's 11 sectors finished higher, but the heavyweight materials sector fell by one per cent and energy dropped by 0.5 per cent.
Major mining companies moved lower, with BHP falling by 1.2 per cent to $43.48 and Rio dropping by one per cent to 107.96.
But the same could not be said about lithium companies, which were still riding high following Thursday's Allkem merger announcement.
Allkem was up by 1.3 per cent to $15.14, Liontown Resources increased by 1.4 per cent to $2.97 and Pilbara remained flat at $4.78.
In the energy sector, Woodside was down 0.4 per cent to $33.66, Santos fell 0.8 per cent to $7.12, Boss Energy dropped 2.5 per cent to $2.76 and Whitehaven Coal fell 0.9 per cent to $6.94.
The biggest gains at close were in the health care and tech sectors.
Blood products giant CSL was up by 1.4 per cent to $306.36 and cloud-based software developer WiseTech Global rose by 1.1 per cent to $70.97.
Australia's major banks managed to claw back losses, with the sector rising by 0.2 per cent.
CBA increased by 0.6 per cent to $98.96, ANZ rose by 0.8 per cent to $24.50, NAB by 0.2 per cent to $26.41 while Westpac was the outlier, falling by 0.19 per cent to $21.09.
Insurance company QBE fell by 3.6 to $14.61 after warning on Friday it anticipates earnings this year will be worse this year.
Flooding in Australia and damage from winter storms in the US has meant a rise in claims, with the insurer taking a profit hit of $190 million.
Looking forward, Australia's Wage Price Index (WPI) will be released on Wednesday but City Index market analyst Matt Simpson expects it will be unlikely to show the "wage spiral" that the RBA fears.
"A hotter number now seems more significant for June's rate decision than it did earlier this week," Mr Simpson said in a statement.
"And if we are to see rising wages accompanied by another strong employment report on Thursday, bets are on for a June hike, which could catapult the Aussie and see the ASX falter."
Ms Mousina said the March quarter WPI should show annual wages growth running at 3.6 per cent over the year.
Meanwhile April employment figures are expected to show a slower pace of jobs growth, which should keep the unemployment rate unchanged at 3.5 per cent, she added.
The Australian dollar was buying 66.95 US cents, from 67.68 US cents at Thursday's ASX close.
ON THE ASX:
* The benchmark S&P/ASX200 index finished on Friday down 4.8 points, or 0.07 per cent, to 7,256.
* The broader All Ordinaries was down 3.5 points, or 0.05 per cent, to 7,453.
One Australian dollar buys:
* 66.95 US cents, from 67.68 US cents at Thursday's ASX close
* 90.22 Japanese yen, from 90.69 Japanese yen
* 61.27 Euro cents, from 61.71 Euro cents
* 53.49 British pence, from 53.62 British pence
* 107.02 NZ cents, from 106.24 NZ cents