Tech Shares Sink U.S. Stocks; Treasuries Fall: Markets Wrap
Bloomberg – Technology and biotech shares led U.S. stocks lower as major averages gave up modest gains. Treasuries slipped.
An index of pharmaceutical stocks fell the most in the S&P 500, while UnitedHealth, Pfizer and Merck notched the biggest drops in the Dow Jones Industrial Average. Equities had been mixed amid data that showed economy remains on solid footing at the same time inflation is muted. Banking shares paced gains ahead of first quarter reports from Wells Fargo and JPMorgan Friday.
The 10-year Treasury yield rose toward 2.50 percent. The dollar advanced the most in a week, while the pound fell as Prime Minister Theresa May accepted the European Union’s offer to push the Brexit deadline out six months.
“People are not yet wholly embracing the rally that’s happened. I think that’s evident in some of the numbers,” Mike Stritch, chief investment officer for U.S. wealth management at BMO Wealth Management, said in an interview. “Earnings season is upon us. People are going to wait and see what expectations look like for the rest of the year. That’s going to be the key theme.”
Investor optimism on global stocks and commodities has endured even as warnings about a global economic slowdown abound. Caution over economic pullbacks has emerged in comments from the European Central Bank, the International Monetary Fund and in the Federal Reserve minutes — which reinforced expectations that interest rates should be on hold for the rest of this year.
Oil in New York retreated from a five-month high as an increase in U.S. inventories to the highest since late 2017 overshadowed OPEC’s efforts to reduce production. In emerging markets, equities declined and were poised to snap their longest streak of gains in more than one year. India’s rupee strengthened as elections started.
Here are some notable events coming up:
U.S. banks begin reporting first-quarter earnings, led by JPMorgan and Wells Fargo. Singapore decides on monetary policy and releases GDP data Friday.
These are the main moves in markets:
The S&P 500 Index fell 0.1 percent as of 11:48 a.m. New York time. The Nasdaq Composite Index fell 0.1 percent. The Stoxx Europe 600 Index increased 0.1 percent. The MSCI Asia Pacific Index sank 0.6 percent to the lowest in more than a week. The MSCI Emerging Market Index fell 0.7 percent, the first retreat in more than two weeks.
The Bloomberg Dollar Spot Index climbed 0.2 percent. The euro was little changed at $1.1271. The Japanese yen dipped 0.3 percent to 111.33 per dollar, the largest decrease in more than a week. The British pound declined 0.1 percent to $1.3078. The MSCI Emerging Markets Currency Index decreased 0.1 percent.
The yield on 10-year Treasuries gained three basis points to 2.49 percent, the biggest gain in more than a week. Germany’s 10-year yield climbed one basis point to -0.02 percent. Britain’s 10-year yield advanced four basis points to 1.14 percent.
The Bloomberg Commodity Index sank 0.5 percent. West Texas crude fell 1.2 percent to $63.84 a barrel. Gold decreased 1.1 percent to $1,299.70 an ounce.