(Bloomberg)
(Bloomberg)

US markets gain on earnings; bonds rise, dollar falls

  • The S&P 500 Index rose 0.2% as of 12:39pm New York time
  • The MSCI All-Country World Index rose 0.2%. The MSCI Emerging Market Index gained 0.1%

US stocks rose as Walmart Inc.’s stellar earnings boosted consumer shares, while Treasuries advanced as investors assessed the prospects for a trade deal with China.

The S&P 500 edged higher in trading more than 15 percent below the 30-day average following a long weekend. Walmart’s best holiday quarter in a decade lifted retailers and homebuilders got a push from a positive sentiment report. But concerns remain that the trade truce will end 1 March without a deal, leading to fresh tariffs. American lenders slumped as the 10-year Treasury yield slid below 2.64%.

The dollar fell against major currencies ahead of speeches from Federal Reserve officials this week and the release of meeting minutes Wednesday that should shed more light on the central bank’s turn to a more dovish tone. China’s yuan traded offshore strengthened against the greenback after a Bloomberg News report saying the US is said to press for a stable Chinese currency as part of negotiations.

“Investors today have greater awareness of all the factors that could send stocks lower, including of course, any additional tariffs or any kind of acceleration in trade conflict," said Kristina Hooper, chief global market strategist at Invesco Ltd. “I think the most important news we would get this week is if we hear that there’s truly going to be an extension on the tariffs."

(Bloomberg)

With earnings season nearing its end, the latest minutes from both the Federal Reserve and European Central Bank due this week and US President Donald Trump weighing an extension of the deadline for a trade deal with China, investors have plenty to ponder right now. Uncertainty over the outlook for global growth hangs over everything, and traders will be hoping for some good news from the world’s two largest economies when talks resume in Washington on Tuesday.

In Asia, Bank of Japan Governor Haruhiko Kuroda told parliament the central bank would consider extra monetary easing if required, helping lift the Topix index and sending the yen lower. Shares in China were little changed as equities in Hong Kong dropped.

Elsewhere, the pound advanced as UK and European officials work on new legal text for the contentious Irish border backstop. The Australian dollar swung to a loss after the nation’s central bank reaffirmed mounting concerns over consumer spending. Gold traded at the highest since May amid increasing bullishness and West Texas crude advanced to trade at about its highest in almost three months.

These are the main moves in markets:

Stocks

The S&P 500 Index rose 0.2% as of 12:39pm New York time. The Stoxx Europe 600 Index dropped 0.2%. The MSCI All-Country World Index rose 0.2%. The MSCI Emerging Market Index gained 0.1%.

Currencies

The Bloomberg Dollar Spot Index fell 0.1%. The euro rose 0.2% to $1.1331. The Japanese yen declined less than 0.05% to 110.66 per dollar. The British pound rose 0.9% to $1.3034, the strongest in more than a week. The MSCI Emerging Markets Currency Index gained 0.1%.

Bonds

The yield on 10-year Treasuries fell two basis points to 2.64%, the lowest in more than a week. Germany’s 10-year yield declined two basis points to 0.095%, the lowest in more than a week. Britain’s 10-year yield decreased one basis point to 1.152%.

Commodities

The Bloomberg Commodity Index climbed 0.3% to the highest about two weeks. West Texas crude rose 0.8% to $56.01 a barrel. Gold rose 1.4% to $1,340.20 an ounce, the highest in nine months.

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