U.S. Stocks Mixed as Treasuries Slip, Oil Gains: Markets Wrap

(Bloomberg) -- U.S. stocks ended the day little changed in light trading, while the 10-year Treasury yield topped 3 percent as investors assess the outlook for trade relations and tensions in the Middle East. Crude oil rose.

The S&P 500 Index eked out a small gain on volume 17 percent below the 30-day average. Technology indexes remained higher, boosted by President Donald Trump’s easing of tension in a trade spat with China. Oil pushed higher as the Gaza Strip erupted over the U.S.’s moving of its embassy to Jerusalem. Rate-sensitive shares slumped as Treasury yields popped above 3 percent. The dollar advanced versus a basket of major peers.

Trump’s shock move on China’s ZTE provided a sign that he may be open to easing trade tensions ahead of a meeting in Washington with Chinese officials this week. A slew of Federal Reserve officials speak in the five days, with investors looking for clues on the pace of monetary tightening. In Europe, political pressures remain high as Italian populists near completion of a government plan, Britain faces a crunch week over Brexit, and the U.S. formally moves its embassy to Jerusalem.

Elsewhere, oil traded near $71 a barrel as the United Arab Emirates said OPEC has enough spare production capacity to mitigate any impact on crude markets if the U.S. re-imposes sanctions on Iran. Earlier, most Asian markets advanced, and Malaysian stocks recovered from an early slide on the first trading day after last week’s unprecedented election result.

Terminal users can read more in our markets live blog.

These are some key events to watch this week:

• China plans to send Vice Premier Liu He to Washington for more trade talks.
• European Union Chief Brexit negotiator Michel Barnier briefs European affairs ministers on the status of talks with the U.K.
• China releases data including industrial production and retail sales figures Tuesday.
• U.K. Prime Minister Theresa May meets with her Brexit cabinet Tuesday to discuss plans for a post-withdrawal customs union.
• U.S. retail sales, industrial production are due this week.
• Vodafone Group, Home Depot, Credit Agricole, Tencent, Cisco Systems, Burberry Group, Walmart, Vivendi, AstraZeneca, Deere, Fujifilm, Noble Group, and Campbell Soup are among the companies releasing earnings this week.

These are the main moves in markets:

Stocks

• The S&P 500 rose 0.1 percent at 4 p.m. in New York. It rose as much as 0.5 percent earlier in the session.
• The Nasdaq Composite Index added 0.3 percent
• The Stoxx Europe 600 Index fell 0.1 percent.
• The MSCI Emerging Market Index advanced 0.2 percent, on its sixth straight advance.

Currencies

• The Bloomberg Dollar Spot Index rose 0.2 percent after erasing a decline.
• The euro slipped 0.1 percent to $1.1935.
• The British pound rose 0.1 percent to $1.3561.

Bonds

• The yield on two-year Treasuries increased one basis point to 2.54 percent, hitting the highest in almost 10 years with its seventh straight advance.
• The yield on 10-year Treasuries gained three basis points to 3.0006 percent.
• Germany’s 10-year yield increased five basis points to 0.61 percent, the highest in almost three weeks.

Commodities

• Gold futures fell 0.5 percent to $1,313.90 an ounce.
• West Texas Intermediate crude gained 0.6 percent to $71.10 a barrel.

--With assistance from Cormac Mullen John Ainger and Natasha Doff

To contact the reporters on this story: Jeremy Herron in New York at jherron8@bloomberg.net, Sarah Ponczek in New York at sponczek2@bloomberg.net.

To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Samuel Potter at spotter33@bloomberg.net, Yakob Peterseil

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