Bonds tumble, stocks mixed as Republican tax bill progresses

Bloomberg

US stocks fluctuated near record highs while Treasury yields climbed to a nine-month peak as the Republican tax overhaul moved closer to passage.
The S&P 500 Index gave up early gains on Wednesday, pulled down in part by consumer stocks. Core European bond yields followed Treasury rates higher, with European Central Bank asset purchases for the year ending on Thursday.
The US Senate’s approval of the tax-cut legislation in a 51-48 party line vote brings President Donald Trump to the brink of his first major legislative victory. The measure is set to go to the House of Representatives for a final vote, and an event was scheduled at the White House on Wednesday. The bill itself will be signed at a later date.
“The tax reform passing, you’d expect the market to celebrate that,” Kevin Caron, a senior portfolio manager at Washington Crossing Advisors, said. “But in reality a lot of this has already been part of the drama over the last year or so in anticipation of this moment. The market has gotten what it has already been discounting in.”
Tech shares led the Stoxx Europe 600 Index to its biggest decline in almost three weeks, with Spanish equities underperforming before Thursday’s Catalan poll. Miners gained as the Bloomberg Commodity Index advanced for a sixth day. The euro climbed against the dollar, as did the British pound. The yen declined.
Meanwhile, oil held onto gains after a report of a drop in US crude stockpiles. Gold edged higher and industrial metals rose.
Earlier, Japan’s Topix index closed at its highest level since November 1991, while stocks in Hong Kong and China declined. The US and UK publish updated estimates of third-quarter GDP. The Bank of Japan will meet on Thursday to set monetary policy. Catalonia votes in an election on Thursday that will pose a test for the Spanish region’s secession movement.
The S&P 500 Index declined less than 0.05 percent as of 11:09 am New York time The Stoxx Europe 600 Index fell 0.7 percent, its biggest drop in almost three weeks. The UK’s FTSE 100 Index fell 0.3 percent. Germany’s DAX Index decreased 1.2 percent.
The Bloomberg Dollar Spot Index declined 0.1 percent. The euro advanced 0.4 percent to $1.1884, the strongest in more than two weeks. The British pound climbed 0.2 percent to $1.3408. The Japanese yen fell 0.4 percent to 113.31 per dollar.
The yield on 10-year Treasuries gained one basis points to 2.48 percent, its fifth straight advance. Germany’s 10-year yield advanced four basis points to 0.42 percent. Britain’s 10-year yield climbed six basis points to 1.264 percent, the highest in more than a week.
West Texas Intermediate rose 0.5 percent to $57.86 a barrel. Gold gained 0.2 percent to $1,264.49 an ounce.