U.S. Stocks Add to Records as Treasuries Advance: Markets Wrap

(Bloomberg) -- U.S. equities added to records as car sales boosted industrial shares, while Treasury yields turned lower and the dollar erased gains after touching a two-month high.

The S&P 500 Index rose for a sixth day to close at another all-time high after American carmakers reported the best month of the year. Treasuries erased losses that had pushed yields above 2.36 percent on the 10-year note, and the dollar retreated from the highest level since July. Oil held above $50 a barrel.

Traders in the U.S. appear to be taking stock after the themes of tax reform, a potentially more hawkish Federal Reserve chief and strong PMI data helped to drive recent gains for both the greenback and equities. And some investors have already turned attention to events that might set the tone for markets the rest of the week -- Fed Chair Janet Yellen’s speech Wednesday and payrolls on Friday.

“There weren’t too many economic numbers on tap today, but some stories are starting to focus on the upcoming payroll numbers on Friday,” Peter Jankovskis, who helps oversee $1.6 billion as co-chief investment officer of Lisle, Illinois-based Oakbrook Investments, said by phone.“People are really focused on looking ahead to that employment number.”

Goldman Sachs Group Inc. analysts see the greenback as having room to run, thanks to solid growth prospects and the chance that Fed interest-rate hikes will prove more aggressive than market players currently anticipate. The firm sees the dollar rising against the euro, which could be hurt by political concerns amid the Spanish woes over Catalonia and by elections in Austria and Italy in coming months.

Terminal subscribers can read more in our Markets Live blog.

Among the key events coming this week:

• The U.K.’s Johnson, Davis, Rudd, Fox speak at the Conservative Party Conference.
• Investors will monitor progress toward forming coalition governments in Germany and New Zealand after elections last month left no party in either country with a majority.
• U.S. data this week include trade, durable goods and Friday’s September non-farm payrolls report, which may have less predictive power than usual for the economic outlook due to likely distortions from hurricanes that hit from late August.
• The Reserve Bank of India on Wednesday is projected to keep benchmark rates unchanged.
• China is due to report monthly foreign-exchange reserves Thursday.
• Fed Chair Janet Yellen speaks at an event on Wednesday.
• Minutes of the last ECB meeting are the European economic highlight this week.

Here are the main moves in markets:

Stocks

• The S&P 500 Index rose 0.2 percent to 2,534.58 as of 4 p.m. New York time.
  • Carmakers in the S&P jumped 1.6 percent after data indicated the U.S. auto market probably expanded for the first time this year.
• The Dow Jones Industrial Average added 84 points to 22,641 for another record and its fifth straight day of gains.
• The Stoxx Europe 600 Index rose 0.2 percent, ninth day in a row of increases.
• The MSCI Emerging Market Index jumped 1.2 percent, the most since July.

Currencies

• The Bloomberg Dollar Spot Index was little changed after touching the highest in almost 11 weeks.
• The euro increased 0.1 percent to $1.1748.
• The British pound decreased 0.3 percent to $1.3238, the weakest in almost three weeks.

Bonds

• The yield on 10-year Treasuries fell one basis point to 2.33 percent.
  • A JPMorgan Chase & Co. survey found clients are the most short the world’s largest bond market in more than a decade.
• Germany’s 10-year yield gained one basis point to 0.46 percent.
• Britain’s 10-year yield rose three basis points to 1.353 percent.

Commodities

• Gold rose 0.1 percent to $1,272.02 an ounce.
• West Texas Intermediate crude for November delivery declined 0.4 percent to settle at $50.42 a barrel, the lowest in more than a week.

--With assistance from Adam Haigh and Sarah Ponczek

To contact the reporter on this story: Randall Jensen in New York at rjensen18@bloomberg.net.

To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Eric J. Weiner