U.S. Stocks Rise to Record Highs; Treasuries Rally: Markets Wrap

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28 Nov 2019, 03:58 AM IST

U.S. Stocks Rise to Record Highs; Treasuries Rally: Markets Wrap

Business men wait for a traffic light to change in front of a screen showing stock prices in Tokyo. (Photographer: Michael Caronna / Bloomberg News)

(Bloomberg) -- U.S. equities closed at all-time highs for a second consecutive day after President Donald Trump said he’s been talking to Chinese President Xi Jinping and that they continue to work for a trade deal. Treasuries rose.

The S&P 500, Dow Jones Industrial Average and Nasdaq Composite climbed to fresh records. China said earlier that negotiators “reached consensus” on certain issues in a phone call and agreed to stay in contact on the remaining points. The Stoxx Europe 600 Index edged higher for a third day, while Asian shares were mixed.

“This phase one trade agreement between the U.S. and China would be at least a step in the right direction,” said Dave Campbell, a principal of San Francisco-based BOS, which manages about $4.5 billion. “Markets would interpret that pretty positively -- in fact, they’re already starting to lean that way.”

The dollar was mixed versus major peers after five consecutive days of gains. Brazil’s central bank intervened in the foreign exchange market for the first time in three months, selling greenbacks to prop up the real after it slumped to a record low. Crude oil gained.

Hopes that a partial trade deal is just around the corner have pushed a global benchmark of stocks to within 1% of an all-time high. A flurry of buyouts has also helped.

”We’re getting to the point where they need to show us the money,” said Michael Reynolds, investment strategy officer at Glenmede Trust Co. “Talk is one thing but an actual deal on paper, pen to paper, is what is going to dramatically change the market narrative.”

Investors are continuing to weigh the dispute’s impact on the world’s largest economy. Federal Reserve Governor Lael Brainard painted a mostly positive picture of the near-term outlook for the U.S. economy while advocating longer-term changes in the conduct of monetary policy in an era of low interest rates and subdued inflation.

Elsewhere, Bitcoin fell for a 10th day, its longest losing streak on record.

Here are some key events coming up this week:

U.S. consumer spending data is due Wednesday, along with GDP, jobless claims and durable goods.
The U.S. celebrates Thanksgiving on Thursday, when equity and bond markets will be shut.
Euro-area inflation for October is due Friday.
The Bank of Korea sets policy on Friday.

These are the main moves in markets:

Stocks

The S&P 500 Index advanced 0.1% to 3,140.40 as of 4:01 p.m. New York time, the highest on record.

The Dow Jones Industrial Average climbed 0.1% to 28,120.73, the highest on record.

The Nasdaq Composite Index increased 0.2% to 8,647.93, the highest on record.

The MSCI All-Country World Index gained 0.1% to 547.93, the highest in 22 months.

Currencies

The Bloomberg Dollar Spot Index was little changed at 1,207.48, hitting the highest in six weeks with its sixth straight advance.

The euro advanced 0.1% to $1.1024, the first advance in a week.

The Japanese yen depreciated 0.1% to 109.04 per dollar, hitting the weakest in two weeks with its fifth straight decline.

The British pound dipped 0.3% to $1.2864.

Bonds

The yield on two-year Treasuries dipped three basis points to 1.58%, the largest decrease in more than a week.

The yield on 10-year Treasuries declined one basis point to 1.74%, the lowest in more than three weeks.

Germany’s 10-year yield fell two basis points to -0.37%, the lowest in more than three weeks.

Britain’s 10-year yield dipped five basis points to 0.65%, the lowest in more than three weeks.

Commodities

Gold strengthened 0.5% to $1,462.44 an ounce, the first advance in a week and the largest climb in more than a week.

West Texas Intermediate crude advanced 0.6% to $58.37 a barrel.

Copper climbed 1.3% to $2.70 a pound, the highest in more than two weeks.

--With assistance from Andreea Papuc.

To contact the reporters on this story: Vildana Hajric in New York at vhajric1@bloomberg.net;Claire Ballentine in New York at cballentine@bloomberg.net

To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Dave Liedtka