U.S. Stocks Edge Higher; Bonds, Dollar Advance: Markets Wrap

(Bloomberg) -- U.S. stocks edged higher, stalling below all-time highs as investors remained skittish about whether the U.S. and China will be able to hash out a partial trade deal. The dollar and Treasuries rose.

The S&P 500 eked out its second straight gain, treading just under its record reached as part of a more than 7% rally since the start of October, fueled by trade hopes, waning recession fears and rate cuts. Tech shares gyrated after a report said farm purchases have become another of several issues in negotiations between the world’s two largest economies. The Dow Jones Industrial Average reached a record as Walt Disney Co. surged following the debut of its streaming service.

The 10-year Treasury yield fell the most in more than a week, while the dollar rose for the seventh time in eight sessions to the highest in a month. The yen advanced along with gold. West Texas crude rose to $57 a barrel.

“There was a mild optimism in the market today fueled by hopefulness about the consumer. On the other hand, the whole trade tariff thing doesn’t seem to be any closer to a resolution,” said John Carey, portfolio manager at Pioneer Investment Management Inc. “That uncertainty is still out there, but at this point people have gotten used to that uncertainty. A continued non-resolution isn’t a new negative, it’s just part of the landscape we’ve been watching.”

The prospect of a deal between the world’s two biggest economies has become key to sustaining a rally that drove American stocks to records, as it appears the Fed will be on the sidelines for a long time. The U.S. and China have yet to announce a new location or time to seal the agreement after an international gathering in Chile was canceled, and it’s unclear whether Trump’s renewed threats will move things forward.

Elsewhere, emerging-market shares fell as Hong Kong’s benchmark stocks gauge slumped as the city endured a third day of unrest. Japanese shares retreated along with those in South Korea and Australia. New Zealand’s dollar jumped after the country’s central bank unexpectedly kept interest rates unchanged.

Here are some key events coming up this week:

• Earnings season is slowing. Reports are due this week from companies including Japan Post Bank, Walmart, and Cisco.
• U.S. CPI and earnings data Wednesday may provide more clues on the Fed’s policy path
• Thursday brings China retail sales and industrial production data.
• U.S. retail sales on Friday are forecast to rebound in October after unexpectedly falling the prior month.

These are the main moves in markets:

Stocks

• The S&P 500 Index rose 0.1% at 4 p.m. New York time.
• The Stoxx Europe 600 Index declined 0.3%.
• The U.K.‘s FTSE 100 Index declined 0.2%.
• The MSCI Emerging Market Index sank 1.2%.

Currencies

• The Bloomberg Dollar Spot Index gained 0.1%.
• The euro was little changed at $1.1005.
• The British pound was little changed at $1.2838.
• The Japanese yen rose 0.2% to 108.84 per dollar.

Bonds

• The yield on 10-year Treasuries sank five basis points to 1.88%.
• Britain’s 10-year yield dipped five basis points to 0.75%.
• Germany’s 10-year yield declined five basis points to -0.299%.
• Japan’s 10-year yield fell two basis points to -0.042%.

Commodities

• West Texas Intermediate crude rose 0.7% to $57.23 a barrel.
• Gold climbed 0.5% to $1,463.99 an ounce.

--With assistance from Robert Brand and Vildana Hajric.

To contact the reporters on this story: Randall Jensen in New York at rjensen18@bloomberg.net;Claire Ballentine in New York at cballentine@bloomberg.net

To contact the editor responsible for this story: Jeremy Herron at jherron8@bloomberg.net

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