U.S. Stocks Cap Best Quarter Since '09; Lyft Soars: Markets Wrap

(Bloomberg) -- Stocks climbed to round out a strong quarter and Treasuries fell amid hopes for a trade deal between the world’s two largest economies. The pound dropped as a political crisis in the U.K. deepened.

The S&P 500 Index posted its best quarter since 2009, and Lyft Inc. surged in its debut after investors rushed to get a piece of the first big U.S. technology listing this year. Treasury 10-year yields increased, following a plunge earlier in the week that triggered concern over an economic slowdown. The pound retreated as Britain edged closer to a general election after Parliament rejected Theresa May’s Brexit deal for a third time.

Traders have piled into risk assets this quarter as major central banks showed willingness to stay accommodative and concern over a trade war eased. Further gains may depend in part on the outcome of negotiations between Washington and Beijing, who are said to be working line-by-line through the text of a deal. White House chief economic adviser Larry Kudlow told CNBC Friday that the U.S. is still making good headway in talks with China.

The American economy looks on track for continued growth, though the inversion of the yield curve may be signaling that the central bank may have set policy too tight, said Federal Reserve Bank of Minneapolis President Neel Kashkari. Meantime, Kudlow called on the Fed to “immediately” cut rates by a half percentage point, according to a report by Axios.

“The real lesson we take away from this quarter is that over time fundamentals control,” said Brad McMillan, chief investment officer for Commonwealth Financial Network, which has $161 billion in assets. “We saw consumer confidence high, we saw jobs growth high, earnings continuing to grow, albeit somewhat slower. When you put all these things together, it says there may be panic-driven declines, but ultimately the fundamentals control.”

Elsewhere, oil closed above $60 for the first time since early November -- capping its best quarter since 2009 -- amid signs of thinning supplies from Siberia to the U.S. shale fields. The ruble slumped after the U.S. was said to have prepared new sanctions on Russia as punishment for a 2018 nerve-agent attack in the U.K. The Turkish lira dropped despite an organized effort to stem losses before elections on Sunday.

These are the main moves in markets:

Stocks

• The S&P 500 rose 0.7 percent to 2,834.41 at 4 p.m. in New York.
• The Stoxx Europe 600 Index increased 0.6 percent.
• The MSCI Asia Pacific Index added 0.7 percent.
• The MSCI Emerging Market Index rallied 1.1 percent.

Currencies

• The Bloomberg Dollar Spot Index gained 0.1 percent.
• The euro was little changed at $1.1218.
• The Japanese yen decreased 0.2 percent to 110.82 per dollar.
• The British pound fell 0.1 percent to $1.3025.

Bonds

• The yield on 10-year Treasuries rose one basis point to 2.40 percent.
• Germany’s 10-year yield slid less than one basis point to -0.07 percent.
• Britain’s 10-year yield was unchanged at 1 percent.

Commodities

• The Bloomberg Commodity Index was little changed.
• West Texas Intermediate crude rose 1.4 percent to $60.14 a barrel.

--With assistance from Shoko Oda, Ksenia Galouchko, Adam Haigh, Sophie Caronello, Nancy Moran, Todd White, Eddie van der Walt and Sarah Ponczek.

To contact the reporters on this story: Rita Nazareth in New York at rnazareth@bloomberg.net;Vildana Hajric in New York at vhajric1@bloomberg.net

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

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