New York: US stocks struggled to finish in a stalemate on 9 April as worries about earnings tempered optimism over strong job growth, falling oil prices and talk of what could be the biggest leveraged buyout ever.
Government bonds held firm after trimming some of the 6-April (Friday) losses in the wake of a surprisingly strong March employment report, but benchmark yields remained near their highest since mid-February. Stock markets were closed on Friday.
Oil fell more than 4% to trade below $62 a barrel as geopolitical concerns related to Iran continued to abate after Tehran’s release last week of 15 British sailors and marines.
The dollar stayed near six-week highs against the yen, buoyed by last week’s jobs report, though stocks had difficulty gaining much traction on the data with the quarterly earnings reports looming later this week.
In fact, some worried the strong jobs picture would keep the Federal Reserve from acting to stimulate the economy anytime soon, keeping Treasury yields high and drawing some investments out of stocks and into bonds.
“With that employment number, people may have thought there would be a little more follow-through this week,” said Owen Fitzpatrick, head of the US equity group at Deutsche Bank Private Wealth Management in New York.
“But there’s a little bit of a concern that earnings results aren’t going to be up to par, and the job number definitely pushes off the Fed coming in and lowering interest rates.”
The Dow Jones industrial average was up 8.94 points, or 0.07%, to end at 12,569.14. The Standard & Poor’s 500 Index edged up just 0.85 of a point, or 0.06%, to finish at 1,444.61. But the Nasdaq Composite Index slipped 2.16 points, or 0.09%, to close at 2,469.18.
A warning from chip maker Advanced Micro Devices underscored investors’ concern about the reporting season. AMD said it expects to report first-quarter revenue below Wall Street’s forecasts. But the company also unveiled a restructuring plan to cut costs, which lifted its stock.
On the deal-making front, a consortium of Middle Eastern investors and American buyout firms is preparing a $50 billion approach for Dow Chemical Co. in what could be the world’s biggest leveraged buyout, according to the UK newspaper Sunday Express.
Dow Chemical’s stock climbed $2.16, or 4.86%, to close at $46.63 on the New York Stock Exchange.
Bonds and dollar gain, gold dips
In the bond market, Treasuries were trying to find a firm footing after steep losses in the previous session. The benchmark 10-year note was up 1/32 in price at 99, yielding 4.75%, down from 4.76% on 6 April. In Monday’s session, yields were still near six-week highs hit on 6 April.
The firm dollar and the slide in oil undermined gold, which ended lower. Gold futures for June delivery on the COMEX division of the New York Mercantile Exchange fell $2.50 to settle at $676.90 an ounce.
The dollar pushed the euro down 0.13% to $1.3359 from $1.3377 late on Friday in New York. It was little changed on the day at 119.27 yen but still near six-week highs against the Japanese currency.
European markets were closed for the Easter Monday holiday.
In Tokyo, the Nikkei share average climbed 1.48%, or 258.98 points, to end at 17,743.76, its highest close since 27 February when a plunge in Chinese shares triggered a global stock sell-off.
— Additional reporting by Kristina Cooke, Robert Gibbons, Pedro Nicolaci da Costa and Frank Tang in New York, and Aya Takada in Tokyo