Stocks Close Mostly Higher on Earnings Confidence: Markets Wrap

(Bloomberg) -- U.S. equity benchmarks finished the day mostly higher, led by technology and health-care companies, while China’s efforts to support its economy spurred interest in higher-risk assets across Asia. The dollar slipped and 10-year Treasuries gained.

The S&P 500 Index rose for the second straight day as positive earnings news overcame traders’ anxieties about simmering trade disputes. Google parent Alphabet Inc. anchored the market’s advance early in the session after it beat analysts’ estimates. Exxon Mobil and Chevron also gained as West Texas crude pushed higher. Indexes retreated from their highs earlier in the session, however, pulling the Nasdaq back from an intraday record.

“You saw a pretty good pop in the market to start, obviously Google earnings helped things get going, but at the same time, you’re 2 percent away from all-time highs,” Tom Essaye, a former Merrill Lynch trader who founded “The Sevens Report” market newsletter, said by phone. “As you pop 20 points in the S&P, you look around and you say, ‘OK. Well is this justified?’ And the answer is no.”

Carmakers and banks were among the biggest winners in the Stocks Europe 600 Index, as PSA Group said subsidiary Opel turned a profit and lender UBS Group AG posted better-than-forecast results. Sterling climbed after Prime Minister Theresa May took control of Brexit talks. The lira plunged as Turkey’s central bank unexpectedly held rates steady.

Shares in Asia rallied on news that China will increase infrastructure spending and take other measures to bolster growth, with the Shanghai Composite Index posting the biggest three-day rally in two years. With Donald Trump again tweeting that tariffs are good for America, China’s moves to shore up growth in the face of a rumbling trade war are reassuring investors.

More earnings will roll in as the week grinds on, while the path of monetary policy will be back in focus as the European Central Bank meets to decide interest rates.

Elsewhere, West Texas Intermediate crude climbed ahead of data on U.S. inventories. Metals rose, helping mining stocks on the European gauge to the best performance since November. Emerging-market shares advanced and Bitcoin surged past $8,000.

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Here are some key events coming up this week:

• Earnings season continues with the following tech companies among those reporting: Facebook, Amazon.com, Twitter, Advanced Micro Devices, Qualcomm and Intel. They are joined by global financial giants Deutsche Bank, Nomura and Visa. Others include Nissan and Shell.
• Pakistan holds national elections Wednesday.
• The European Central Bank’s policy decision is Thursday.
• U.S. gross domestic product probably increased by about 4.2 percent at an annualized rate in the second quarter, the most since 2014, economists forecast ahead of Friday’s data.

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These are the main moves in markets:

Stocks

• The S&P 500 Index rose 0.5 percent as of 4:01 p.m. New York time.
• The Stoxx Europe 600 Index climbed 0.9 percent, the largest increase in a month.
• The U.K.’s FTSE 100 advanced 0.7 percent to its highest in more than five weeks.
• The MSCI Emerging Market Index rose 1.1 percent, its biggest climb in two weeks.

Currencies

• The Bloomberg Dollar Spot Index declined 0.1 percent to its lowest in a week.
• The euro fell less than 0.05 percent to $1.1687.
• The British pound climbed 0.4 percent to $1.3147.
• The Japanese yen rose 0.1 percent to 111.19 per dollar, its fifth straight advance.
• The Turkish lira fell 3 percent to 4.887 per dollar.

Bonds

• The yield on 10-year Treasuries fell one basis point to 2.95 percent.
• Britain’s 10-year yield increased less than one basis point to 1.276 percent.
• Germany’s 10-year yield fell one basis point to 0.40 percent.

Commodities

• West Texas Intermediate crude rose 0.9 percent to $68.48 a barrel.
• Gold rose 0.1 percent to $1,225.25 an ounce.
• LME copper jumped 2.7 percent to $6,295.00 a metric ton, the highest in more than a week.
• The Bloomberg Commodity Index increased 0.5 percent to the highest in more than a week.

--With assistance from Samuel Potter, Tian Chen, Andreea Papuc and Olivia Schaber.

To contact the reporters on this story: Eddie van der Walt in London at evanderwalt@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, Andrew Dunn, Dave Liedtka

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