Stocks advance, Treasuries slide on upbeat China data

Bloomberg

Stocks strengthened worldwide as strong manufacturing data out of the world’s second largest economy helped ease investor worries about a slowdown in global growth. Treasuries extended losses after as a gauge of US factories topped estimates in March.
The S&P 500, Dow and Nasdaq were all in the green. Shares of Lyft dropped below its IPO price as analysts noted there is limited visibility into the company’s path to growth and profitability. The Stoxx Europe 600 Index climbed on the heels of its best quarter in four years after key China manufacturing PMIs for March beat the highest estimate in Bloomberg surveys of economists. That’s despite manufacturing data for Europe coming in at the lowest since 2013, which briefly caused the euro to pare some of its gains.
In Asia, Chinese shares surged to the highest since May, while Hong Kong stocks entered a bull market. The yen declined. Global equities are building on their strongest quarter since 2010 amid bets that dovish tilts by major central banks will help prop up earnings. The Chinese data went some way toward easing worries about a slowdown prior to the release of American monthly jobs numbers at the end of the week.
US-China trade talks will resume when Vice Premier Liu He leads a delegation to Washington later this week, potentially offering more positive developments for investors.
“Monday’s PMI data, and also there was the services data over the weekend, do a lot to remove the worst case fears about China for now,” David Russell, vice president at TradeStation, said.
Elsewhere, the pound extended its gain as UK factory data reached a 13-month high on Brexit stockpiling and as lawmakers prepare to vote on alternative options to replace Prime Minister Theresa May’s divorce plan.
UK Parliament will take up indicative votes on Brexit proposals on Monday as members seek a compromise to break an impasse over May’s withdrawal agreement. The Reserve Bank of Australia decides on monetary policy on Tuesday at a time of falling growth forecasts. Then Australia will release its federal budget that evening. Chinese Vice Premier Liu He leads a delegation of trade negotiators to Washington on Wednesday, days after US Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer traveled to Beijing. The monthly US jobs report on Friday is projected to show nonfarm payrolls up 175,000 in March, similar to the 186,000 average over the prior three months, after recent readings whipsawed analysts. Economists think the jobless rate held at 3.8 percent with hourly earnings growing at a strong clip.
The S&P 500 Index rose 0.9 percent in New York, while the Nasdaq Composite Index gained 1 percent and the Dow Jones Industrial Average climbed 0.8 percent. The Stoxx Europe 600 rose 1.2 percent. The MSCI Emerging Market Index increased 1.2 percent. The MSCI Asia Pacific Index rose 1.1 percent.
The Bloomberg Dollar Spot Index eased 0.1 percent, the first drop in five trading sessions. The euro was little changed at $1.1220, while the yen weakened 0.3 percent to 111.18 per dollar. The British pound gained 0.7 percent to $1.3128. The MSCI Emerging Markets Currency Index rose 0.3 percent.
The yield on 10-year Treasuries jumped eight basis points to 2.48 percent. Germany’s 10-year yield climbed five basis points to negative 0.02 percent.
West Texas Intermediate rose 1.3 percent to $60.92 a barrel.