S&P 500 Climbs Beyond 3,000 on Trade; Bonds Fall: Markets Wrap

(Bloomberg) -- U.S. stocks advanced amid positive signs on trade talks and as investors awaited earnings from some of the world’s biggest companies. Treasuries fell.

The S&P 500 Index climbed to a one-month high, surpassing the 3,000 level, led by energy and financial shares. Apple Inc. rallied to a record, while Teva Pharmaceutical Industries Ltd. surged after saying it has an agreement to settle thousands of opioid lawsuits. The Dow Jones Industrial Average underperformed major equity gauges as Boeing Co. tumbled on pessimism over the 737 Max crisis. The British pound dropped after Prime Minister Boris Johnson was thwarted in his latest attempt to get a Brexit deal approved.

Investors monitored the latest developments on trade talks between the two largest economies, with U.S. President Donald Trump saying China has indicated that negotiations over an initial deal are advancing. Earlier Monday, Commerce Secretary Wilbur Ross said it was more important to get details of the agreement right than it was for Trump to sign it at the expected meeting with Chinese President Xi Jinping next month in Chile.

“What’s most important is that negotiations continue. That will help with confidence,” said Don Townswick, director of equity strategies at Conning, which has about $171 billion in global assets under management. “Earnings have been coming in fairly strong, at least relative to expectations. And that’s important.”

Read: Analysts Are Taking the Knife to Their 2020 Profit Estimates

With industry heavyweights McDonald’s Corp., Caterpillar Inc. and Amazon.com Inc. all scheduled to deliver earnings this week, investors will get numerous chances to see how corporations are withstanding the effects of trade tension, slowing economic growth and Brexit.

“The needle is pointing mildly positive,” David Sowerby, portfolio manager at Ancora Advisors. “As much as the trade issue is a headwind, I think companies are quite sensible in how they are spending their capital on healthy cash flow growth.”

Here are some key events coming up this week:

• Earnings season is in full swing with companies reporting including: Amazon.com, Microsoft, Daimler, Kia Motors, McDonald’s, Procter & Gamble, Caterpillar and UBS.
• Thursday brings monetary policy decisions from the European Central Bank and Bank Indonesia.
• U.S. factory orders for business equipment will provide a look into the strength of capital investment in September. The figures will show to what extent the latest tranche of tariffs on China and others is impacting investment decisions.

These are the main moves in markets:

Stocks

• The S&P 500 climbed 0.7% to 3,006.72 as of 4 p.m. New York time.
• The Stoxx Europe 600 Index rose 0.6%.
• The MSCI Asia Pacific Index increased 0.4%.
• The MSCI Emerging Market Index added 0.5%.

Currencies

• The Bloomberg Dollar Spot Index was little changed.
• The euro decreased 0.2% to $1.1148.
• The British pound declined 0.2% to $1.2962.
• The Japanese yen fell 0.2% to 108.64 per dollar.

Bonds

• The yield on 10-year Treasuries jumped four basis points to 1.80%.
• Germany’s 10-year yield increased four basis points to -0.34%.
• Britain’s 10-year yield rose four basis points to 0.75%.

Commodities

• The Bloomberg Commodity Index slid 0.5%.
• West Texas Intermediate crude fell 0.9% to $53.31 a barrel.
• Gold lost 0.4% to $1,488.10 an ounce.

--With assistance from Sybilla Gross, Adam Haigh, Todd White, Samuel Potter, Sarah Ponczek and Lu Wang.

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;Claire Ballentine in New York at cballentine@bloomberg.net

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

©2019 Bloomberg L.P.