What you need2know

SPI futures 5433 +23

AUD fetching 71.28 US cents, 79.27 Japanese yen, 64.58 Euro cents and 49.14 British pence

On Wall St, Dow Jones +0.25%, S&P 500 +0.43%, Nasdaq +0.65%.

In Europe, Stoxx 50 +0.2%, FTSE +0.2%,

Spot gold -0.9% at $US1,208.90 an ounce at 5am on Monday in Sydney.

Brent crude -0.5% at $US49.32 a barrel at 5am on Monday in Sydney.

Iron ore added 3.4% to $US51.15 per tonne

This week's agenda

Local: The main market interest will be in the quarterly data in the lead up to Wednesday's GDP, followed Thursday's by retail sales report.

China: The largest focus will be Wednesday's official PMIs and Caixin manufacturing PMI, followed Friday by the Caixin services/compositePMIs

US: After Monday's Memorial Day holiday, main interest will be in Tuesday's personal income, spending and PCE deflators report, the ISM Manufacturing on Wednesday and the big one, non-farm payrolls, rounding out the week with the ISM non-manufacturing also on Friday.

Currencies

The US dollar index hit a two-month high and US bond prices have fallen after Federal Reserve Chair Janet Yellen said a US interest rate hike will likely be appropriate in the coming months.

Although they briefly trimmed gains on Yellen's remarks, US stocks ended higher on Friday and the S&P 500 capped off its strongest week since March.

Commodities

Oil prices dipped for a second day in a row, with investors taking profits after a surge to seven-month highs above $50 a barrel this week.

Brent crude fell 27 cents to settle at $49.32. It rose to $50.51 in the previous session, its highest since early November. US crude dipped 15 cents to settle at $49.33. It hit its October high of $50.21 on Thursday.

"People are worried crude production will come roaring back at these prices," said Phil Flynn, energy markets analyst at the Price Futures Group in Chicago.

Gold slid to an eight-week low amid the US rate hike speculation. Spot gold was down 0.3 per cent at $1,215.39 an ounce.

United States

Last week, US stocks capped off their strongest week since March after US Federal Reserve Chair Janet Yellen said an interest-rate hike would likely be appropriate "in the coming months."

On Saturday, the Dow Jones index climbed 0.25 per cent to 17,873.22 points, the S&P 500 gained 0.43 per cent to 2,099.06, and the Nasdaq added 0.65 per cent to 4,933.51.

For the week, the S&P 500 rose 2.3 per cent and the Dow added 2.1 per cent, the best weekly performance for both since March.

Europe

European stocks extended a third weekly increase, amid optimism that the economy is strong enough to withstand higher US borrowing costs, as traders awaited Federal Reserve??Chair Janet Yellen's speech..

The Stoxx Europe 600 Index added 0.2 per cent at the close of trading in London, taking its advance to 3.4 per cent for the week. The number of shares on the gauge changing hands was about 20 per cent lower than the 30-day average, before holidays in the U.K. and US on Monday.

What happened on Friday

Australian shares rose for a seventh consecutive week, pushing the ASX above the 5400-point barrier that had long been a stumbling block to the index and bringing the market to levels last seen in August 2015.

The S&P/ASX200 lifted 0.3 per cent on Friday and 1 per cent for the week to 5405.9 while the broader All Ordinaries gained 0.3 per cent on Friday and 1 per cent for the week to 5469.7.

The benchmark S&P/ASX200 index has now put on 9.8 per cent since the first week of April, amid improving global sentiment, oil prices rising over $US50 per barrel, growing acceptance of further US Federal Reserve rate hikes, and solid local earnings reports.