Stocks Set for Weekly Gain as Bonds Extend Retreat: Markets Wrap

 

 

 

 

 

 

 

Here are the main moves in markets:

Stocks

• Futures on the S&P 500 Index increased 0.4% as of 8:30 a.m. New York time.
• Germany’s DAX Index gained 0.5%.
• The MSCI Asia Pacific Index rose 0.7%.
• The U.K.’s FTSE 100 Index decreased 0.1%.

Currencies

• The Bloomberg Dollar Spot Index fell 0.3%.
• The euro increased 0.2% to $1.1087.
• The British pound rose 0.9% to $1.2444.
• The Japanese yen increased 0.1% to 108.04 per dollar.

Bonds

• The yield on 10-year Treasuries increased four basis points to 1.81%.
• Germany’s 10-year yield climbed two basis points to -0.49%.
• Britain’s 10-year yield gained five basis points to 0.72%.

Commodities

• West Texas Intermediate crude increased 0.4% to $55.31 a barrel.
• Gold climbed 0.3% to $1,504.36 an ounce.

S&P 500 near all-time high;

Sterling advances on Brexit news

Glimmers of trade hope, central bank stimulus lift sentiment

U.S. equity futures rose with stocks in Europe and Asia on Friday, as shares globally headed for a third weekly gain thanks to easing trade fears and a new round of central bank stimulus. Treasury yields climbed and the dollar slipped.

Contracts for all three main American stock gauges pointed to a firm start on Wall Street, where all eyes will be on the S&P 500 after it closed near a record. The Stoxx Europe 600 rose a fourth day led by banks and miners. In Asia, Japan’s Topix rose to its highest since May. Exchanges in China and South Korea were closed for a holiday.

The pound headed for the biggest weekly gain since May after the Times reported possible progress in Brexit negotiations related to the contentious Irish backstop. Prime Minister Boris Johnson will meet EU President Jean-Claude Juncker next week. The euro extended a rally and most government bonds retreated in the wake of the European Central Bank’s moves to support growth, with one policy maker saying a new easing package was a possible mistake. Ten-year Treasury yields headed for the highest in more than a month.

 

Optimism over a trade deal is growing ahead of expected high-level talks next month between the world’s two largest economies. The S&P 500 climbed to just 0.5% below its all-time high on Thursday after a news broke about an interim trade agreement under consideration by the Trump administration. On Friday, Soybean futures extended a rally from a day earlier after the Xinhua News Agency said China is encouraging companies to buy certain U.S. farm products and it will exclude those goods from additional tariffs.

“I’m less cautious now on equities” after the past 24 hours, Commerzbank global equities economist Peter Dixon said on Bloomberg TV. “We’re operating in an environment where central bankers are saying interest rates are going to remain negative for an awful long time to come. The dividend yield on stocks continues to look attractive. I certainly wouldn’t be a seller under these circumstances.”

U.S. retail sales in August advanced by more than forecast after consumer spending also beat expectations in July. The University of Michigan’s consumer sentiment survey, due later, is forecast to show a modest pickup in confidence.

 

Elsewhere, WTI crude fluctuated around $55 a barrel, poised for a weekly drop following a warning from the International Energy Agency of a “daunting” surplus of crude in 2020.