Stocks Gain on Stimulus Hopes in Choppy Trading: Markets Wrap

(Bloomberg) -- U.S. stocks finished higher after a volatile session that saw traders whipsawed by reports on the outlook for a new round of government stimulus.

The S&P 500 Index climbed 0.8%, paring gains of as much as 1.7% after Treasury Secretary Steven Mnuchin said there had been no agreement on pandemic relief. Speculation a deal was in the works kept the benchmark at a two-week high. An exchange-traded fund tracking the S&P 500 fell 0.2% in after-hours trading as Democrats postponed a vote on their proposal with negotiations continuing.

Portfolio rebalancing tied to the end of the month added to volatility, and global investors are also keeping an eye on news about coronavirus vaccines amid the latest moves in Washington. New Jersey reported an uptick in the statewide positivity rate to the highest in months, while Spain ordered extra restrictions in Madrid to curb spread in Europe’s hardest-hit nation.

“As coronavirus continues to linger and certain areas of the economy are still shut down, you need some sort of stimulus package,” said Andrea Roemhildt, investment manager at Aware Asset Management. “The market is just waiting for a signal that this might actually get done.”

The S&P 500 posted an 8.5% gain this quarter, a slowdown from the previous three months’ 20% leap but still an impressive return considering the economic havoc wrought by the coronavirus. The benchmark index was down more than 6% from an all-time high reached on Sept. 2.

Treasury yields ticked higher Wednesday while the dollar weakened. Emerging-market stocks gained. Europe’s benchmark index slipped.

Elsewhere, equities slumped in Asia. Crude oil advanced toward $40 a barrel amid optimism over shrinking U.S. supplies.

Here are some key events coming up:

• The September U.S. employment report on Friday will be the last before the November election.

These are the main moves in markets:

Stocks

• The S&P 500 Index rose 0.8% as of 4 p.m. New York time.
• The Stoxx Europe 600 Index fell 0.1%.
• The MSCI Asia Pacific Index decreased 0.1%.

Currencies

• The Bloomberg Dollar Spot Index fell 0.3%.
• The British pound rose 0.4% to $1.2917.
• The euro slumped 0.2% to $1.1726.

Bonds

• The yield on 10-year Treasuries rose four basis points to 0.69%.
• Germany’s 10-year yield rose two basis points to -0.52%.
• Britain’s 10-year yield climbed five basis points to 0.23%.
• New Zealand’s 10-year yield climbed five basis points to 0.485%.

Commodities

• West Texas Intermediate crude rose 1.9% to $40.02 a barrel.
• Gold weakened 0.5% to $1,888.65 an ounce.
• The Bloomberg Commodities Index rose 0.8%.

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