U.S. Stocks Rise as Trade in Focus; Bonds Drop: Markets Wrap

(Bloomberg) -- U.S. stocks advanced as investors speculated the Trump administration won’t move forward with a tariff hike on Chinese goods scheduled for Dec. 15. Bonds and the dollar fell.

The S&P 500 Index continued to rebound from a sell-off sparked by a spike in trade tensions that many investors now view as negotiating bluster. Treasury yields climbed after data showed jobless claims slumped to a seven-month low, signaling resilience in the labor market ahead of Friday’s jobs report. Oil closed flat in a very volatile session as OPEC failed to impress traders with what appeared to be a cosmetic revision to output quotas.

Investors watched for signs the world’s two largest economies will reach a truce in a dispute that’s led to the biggest volley of tariffs since the 1930s. Equities rebounded after President Donald Trump’s remarks that negotiations were “moving along well.” Gains were briefly capped by a news report that the U.S. and China remained at odds over the value of farm purchases.

“Things are looking modestly positive, but that can change on a dime,” Michael Reynolds, investment strategy officer at Glenmede Trust Co. “We’re expecting trade to dominate the narrative for the next week and a half as we approach that December 15 deadline.”

Traders also awaited Friday’s U.S. jobs report, which may signal that both the labor market and consumers remain buoyant enough to sustain the expansion. That would validate Federal Reserve Chairman Jerome Powell’s view that rates can stay on hold following three cuts. But it could also reduce the urgency for a deal with China, given that escalating levies have so far failed to significantly dent employment.

Elsewhere, oil prices sputtered as OPEC reached an agreement that adjusts its official production targets, but removes few barrels from a market that’s forecast to return to surplus early next year.

On corporate news:

• Nike Inc. rallied after Goldman Sachs Group Inc. recommended buying the shares.
• Apple Inc. rose as its price target was raised at Citigroup Inc.
• Acadia Pharmaceuticals Inc. soared on promising data from its dementia drug trial.
• Energy Fuels Inc. and Ur-Energy Inc. jumped as a White House report recommended ways to revive the uranium industry.
• Biogen Inc. climbed after initially dropping on plans to resume studies of its once-abandoned drug for Alzheimer’s disease.
• Sage Therapeutics Inc. sank as a key depression study failed to show benefit.
• At Home Group Inc. tumbled as its forecast disappointed investors.

Here are some key events coming up this week:

• U.S. Labor Department figures are expected to show Friday that 184,000 workers were added to nonfarm payrolls last month -- one of the highest estimates this year ahead of a jobs report.

These are some of the main moves in markets:

Stocks

• The S&P 500 rose 0.2% to 3,117.43 at 4 p.m. New York time.
• The Stoxx Europe 600 Index fell 0.1%.
• The MSCI Asia Pacific Index advanced 0.7%.

Currencies

• The Bloomberg Dollar Spot Index lost 0.2%.
• The euro increased 0.3% to $1.1107.
• The Japanese yen added 0.1% to 108.78 per dollar.

Bonds

• The yield on 10-year Treasuries climbed three basis points to 1.80%.
• Germany’s 10-year yield advanced two basis points to -0.29%.
• Britain’s 10-year yield increased three basis points to 0.773%.

Commodities

• The Bloomberg Commodity Index gained 0.3%.
• West Texas Intermediate crude was unchanged at $58.43 a barrel.
• Gold rose 0.2% to $1,483.10 an ounce.

--With assistance from Cormac Mullen, Adam Haigh, Sam Potter, Todd White, Claire Ballentine and Vildana Hajric.

To contact the reporters on this story: Rita Nazareth in New York at rnazareth@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

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