U.S. Stocks Advance, Bonds Fall as Earnings Eyed: Markets Wrap
(Bloomberg) – U.S. stocks rallied and Treasuries slid with oil as geopolitical tensions eased and investors turned their attention to corporate results.
The S&P 500 Index padded last week’s gain after there was no immediate reprisal to U.S., France and the U.K.’s missile attack in Syria and the trade spat cooled. Treasury yields edged to the highest in three weeks, while the greenback fell to the lowest since March after President Donald Trump accused China and Russia of devaluing their currencies. West Texas crude futures fell below $67 a barrel amid concern that shale production will rise further.
“There was a significant fear of potential escalation; that hasn’t happened so far,” said Callum Henderson, a Eurasia Group managing director in Singapore. Even so, “it remains to be seen how long this market rally lasts on the back of this specific factor — whether or not, or when, Russia retaliates,” he said on Bloomberg Television.
U.S. President Donald Trump declared “mission accomplished” via Twitter on Saturday, a day after the U.S., France and the U.K. launched military strikes in response to Syrian leader Bashar al-Assad’s suspected chemical attack on civilians. While geopolitical concerns linger, with new U.S. sanctions on Russia, the focus this week is back on earnings season in the U.S. and a slew of Federal Reserve officials who are due to speak, including the incoming head of the New York Fed, John Williams.
Aluminum resumed its rally, adding to what was its biggest weekly increase on record Friday. The yen edged up as polls showed falling support for Japanese Prime Minister Shinzo Abe’s government.
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Here’s what to watch out for this week:
Goldman Sachs Group Inc. and Morgan Stanley among companies reporting results John Williams, soon to be president of the New York Fed, speaks on economic outlook in Madrid on Tuesday. China GDP and Japanese inflation are the featured data points in Asia. Trump welcomes Japan Prime Minister Shinzo Abe to Mar-a-Lago on Tuesday. North Korea and trade will probably be discussed. Mining investors will get to take the pulse of the global industry this week, with Vale, Rio Tinto and BHP offering quarterly production reports.Here are the main moves in markets:
The S&P 500 Index gained 0.3 percent as of 9:43 a.m. New York time. The Stoxx Europe 600 Index decreased 0.3 percent The MSCI All-Country World Index rose less than 0.05 percent. The U.K.’s FTSE 100 Index decreased 0.5 percent to the lowest in a week on the largest dip in more than three weeks.
The Bloomberg Dollar Spot Index declined 0.3 percent to the lowest in three weeks. The euro gained 0.5 percent to $1.2387, the strongest in almost three weeks. The British pound gained 0.6 percent to $1.4324, hitting the strongest in about 22 months . The Japanese yen advanced 0.1 percent to 107.27 per dollar.
The yield on 10-year Treasuries increased three basis points to 2.86 percent, the highest in almost four weeks. Britain’s 10-year yield increased four basis points to 1.455 percent, the highest in almost four weeks. Germany’s 10-year yield jumped three basis points to 0.54 percent, the highest in almost four weeks on the largest surge in almost six weeks.
Gold rose 0.1 percent to $1,345.46 an ounce. West Texas Intermediate crude dipped 0.9 percent to $66.79 a barrel, the first retreat in more than a week. LME aluminum gained 3.3 percent to $2,360.50 per metric ton, the highest in more than six years. LME copper climbed 0.5 percent to $6,863.00 per metric ton.