U.S. stocks pared declines after President Donald Trump said he plans to delay imposing tariffs on auto imports. A rally in Treasuries pushed yields to multimonth lows.
The S&P 500 nearly reversed a drop of as much 0.7% in early trading as carmarkers that had been leading the day’s decline turned higher. The tech-heavy Nasdaq 100 also rose after Treasury Secretary Steven Mnuchin added to hopes of a trade deal when he said U.S. officials were in “serious” talks with China to improve trade ties.
Treasuries advanced, sending the two-year yield to the lowest level since February 2018, while the 10-year rate fell toward 2.36% as mounting tensions in the Middle East over
U.S.-Iran relations added to demand for haven assets. Oil retreated and gold rose, while the Japanese yen and Swiss franc gained against the dollar.
“Trade is far and away the more dominant story right now, but sales should not go unnoticed ahead of Consumer Confidence reads later this week,” said Mike Loewengart, vice president of investment strategy at E*TRADE Financial. “Many view retail as a key economic bellwether, and so weakness in the sector could give the bears more to sink their teeth into.”
The unexpectedly weak U.S. economic numbers on the back of data pointing to slowing growth out of China heightened investors concerns Wednesday that the trade war could weigh on a global economy that’s already staggering. Adding to those woes is a growing sense of unease in the Middle East after a spat of attacks on oil assets ratcheted up an already tense relationship between America and Iran.
Elsewhere, oil fell as an industry report signaling a jump in U.S.
stockpiles eased concerns over a supply crunch, after a drone attack in Saudi Arabia had highlighted the vulnerability of the country’s energy infrastructure.
Here are some notable events coming up this week:
- Earnings this week include Cisco, Nvidia.
- Bank of Indonesia has an interest rate decision on Thursday.
- Australian unemployment is out on Thursday.
And here are the main market moves:
- The S&P 500 Index sank 0.1% as of 10:19 a.m. New York time
- The Stoxx Europe 600 Index declined 0.5%.
- Germany’s DAX Index declined 0.9%.
- The MSCI Emerging Market Index fell 0.1%.
- The MSCI Asia Pacific Index advanced 0.5%, the biggest gain in six weeks.
- The Bloomberg Dollar Spot Index climbed 0.2%, the highest in almost three weeks.
- The euro fell 0.2% to $1.1184, the weakest in almost two weeks.
- The British pound dipped 0.4% to $1.2860, the weakest in almost three months.
- The Japanese yen gained 0.3% to 109.27 per dollar, the strongest in almost 15 weeks.
- The yield on 10-year Treasuries fell four basis points to 2.37%, the lowest in seven weeks.
- Germany’s 10-year yield dipped six basis points to -0.13%, the lowest in more than two years.
- Britain’s 10-year yield declined seven basis points to 1.034%, the lowest in six weeks.
- West Texas Intermediate crude dipped 1% to $61.11 a barrel.
- Gold advanced 0.3% to $1,300.10 an ounce.
— With assistance by Charlotte Ryan, and Vildana Hajric