Global stock declines show signs of easing, dollar continues to fall

Bloomberg

The global stock declines that have shaped the week showed signs of easing in the US, with all three major equity indices trading higher. The dollar slump deepened in the wake of President Donald Trump’s State of the Union address.
The S&P 500 Index gained for the first time in three days as companies including Xerox Corp., Anthem Inc., and Boeing Co. gained on positive earnings reports. Facebook Inc., Microsoft Corp. and Qualcomm Inc. report after the bell. The Stoxx Europe 600 Index fell, paring an earlier advance amid a flurry of corporate results.
It’s been a big month for stock markets, with stellar gains across most major gauges that were followed this week by the MSCI All-Country World Index’s biggest two-day slide since September 2016. Investors will now be focussing on Wednesday’s Federal Reserve rate decision, the accelerating earnings season and more big economic data points to see if the uptrend can resume.
“A lot of the recent moves in the equity market is a return of healthy volatility. Even with two days of downward movement and then the recovery so far today, we’re still going to have a relatively positive month for equities,” said Luke Tilley, chief economist at money manager Wilmington Trust Corp. “It’s healthy, and we think that investors are discriminating a bit more between equities.”
The dollar fell against almost every major peer after Trump offered few new clues on US policy in his speech, and most bonds gained as the Bank of Japan increased asset purchases.
The yield on the benchmark 10-year US note rose to 2.74 percent, the highest since April 2014, after the Treasury raised the amount of long-term bonds it will sell this quarter with the budget deficit worsening. The MSCI Asia Pacific Index declined for a third session as a slump in Japanese shares weighed on the broader gauge.
Elsewhere, South Africa’s rand hit the strongest level in almost three years as President Jacob Zuma’s future once again came into focus. Oil was little changed. A measure of China’s manufacturing sector was below expectations, while services gauge topped estimates.
The S&P 500 Index rose 0.1 percent, the Dow Jones Industrial Average gained 0.5 percent and the Nasdaq Composite Index climbed 0.2 percent as of 10:20 am New York time. The Stoxx Europe 600 Index dipped 0.2 percent. The MSCI Asia Pacific Index decreased 0.4 percent. The UK’s FTSE 100 Index dipped 0.7 percent.
The Bloomberg Dollar Spot Index declined 0.2 percent. The euro rose 0.3 percent to $1.2433. The British pound increased 0.3 percent to $1.4194. The Japanese yen weakened 0.5 percent to 109.40 per dollar. The yield on 10-year Treasuries rose two basis points to 2.74 percent. Germany’s 10-year yield fell one basis point to 0.67 percents. Britain’s 10-year yield rose two basis point to 1.48 percent. West Texas Intermediate crude fell 0.4 percent to $64.31 a barrel. Gold rose 0.2 percent to $1,341.42 an ounce.