U.S. Stocks Add to Records, Dollar Gains With Oil: Markets Wrap

(Bloomberg) -- U.S. stocks rose to records as retailer results topped estimates, while the dollar resumed its advance amid fresh signs global growth has started to accelerate. Mexico’s peso rallied after the central bank signaled support.

The S&P 500 Index rose after results from Wal-Mart Stores Inc. and Home Depot Inc. bolstered confidence the American consumer can stoke growth. European equities advanced after readings on euro-area manufacturing topped estimates. The dollar climbed on speculation rates could rise as soon as next month. It pared gains in afternoon trading as the peso soared after the central bank said it will bolster the currency without draining international reserves. Oil settled higher.

Equity bulls added to long positions after a three-day holiday in the U.S. as corporate results and the European growth figures boosted optimism that the Trump administration will only bolster already-strengthening economies. The prospect of tightening monetary policy helped stoke the dollar, which has been trading below this year’s highs as investors clamor for detail on spending plans.

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Here are some events that investors are watching out for:

• The Fed releases minutes this week from its most recent meeting, possibly giving investors a look into how members see Trump’s policies. Data should show the U.S. housing market perking up at the start of the year.
• In Asia on Wednesday, Hong Kong will deliver its latest growth figures and miners will be in focus as commodities continue to advance.
• It’s International Petroleum Week in London and top OPEC, government and company officials are attending.

Here are the main market moves:

Stocks

• The S&P 500 climbed 0.6 percent to a record 2,365.28 at 4 p.m. in New York, its ninth gain in the past 10 sessions.
• The Dow Jones Industrial Average, the Nasdaq Composite Index and the Russell 2000 Index also closed at all-time highs.
• Real-estate and utility shares rose the most as Treasury yields advanced.
• Home Depot added 1.3 percent and Wal-Mart rose 3 percent.
• The Stoxx Europe 600 index advanced 0.6 percent for a third straight gain that left it at the highest since December 2015.
• Banking stocks in Europe fell 1 percent after HSBC missed earnings estimates and said it will boost cost-cutting measures and extend a stock buyback.
• Asian stock rose, with South Korea’s benchmark climbing 0.9 percent to the highest level since July 2015. Hong Kong’s Hang Seng slipped 0.8 percent, the most in more than a month.

Currencies

• The Bloomberg Dollar Spot Index gained 0.2 percent, paring a rise that reached 0.6 percent after Market News International cited Philadelphia Fed President Patrick Harker, who votes on policy this year, saying a rate move next month is not “off the table at this point.” That followed hawkish congressional testimony last week from Fed Chair Janet Yellen.
• The euro weakened 0.7 percent to $1.0545. 
• The peso strengthened to 20.01 per dollar.

Bonds

• The yield on 10-year Treasuries rose one basis point to 2.43 percent after earlier adding four basis points to 2.46 percent. 
• German benchmark yields rose less than one basis point after better-than-expected PMI euro- area manufacturing data. The yield on the equivalent French bonds climbed three basis points.

Commodities

• U.S. natural gas extended its decline into a third day due to forecasts for warmer-than-normal weather across the east coast. Futures fell 9.5 percent to $2.564 per million British thermal units.
• Oil advanced as Citigroup Inc. raised its short-term price outlook, citing good OPEC compliance with its output-cut agreement and growing demand in Asia. West Texas Intermediate gained 1.2 percent to settle at $54.09 a barrel and Brent added 0.9 percent. 
• Gold declined 0.1 percent to $1,237.80 an ounce.

--With assistance from James Herron Blaise Robinson Vassilis Karamanis Simon Ballard Stephen Spratt and Cecile Gutscher

To contact the reporter on this story: Jeremy Herron in New York at jherron8@bloomberg.net.

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