Stocks turn mixed; Treasury yields climb

Bloomberg

US stocks were mixed and benchmark Treasury 10-year note yields rise to a 10-month high as investors mulled the prospects of the economic
recovery and vaccine rollout.
The S&P 500 was little changed, with the energy and consumer discretionary sectors gaining, while utilities and communication services were the biggest decliners. Europe’s Stoxx 600 Index traded little changed. The dollar weakened following a three-day rally. After Bitcoin suffered steep declines on Monday, the largest cryptocurrency continued its wide swings.
The mood across markets was mildly positive as investors assess how the rise in Treasury yields changes the financial landscape. While progress on a vaccine gives reason to be hopeful, there are lingering concerns over the speculative excess and froth that’s driven stock markets to all-time highs in the middle of a pandemic.
“What I think investors are most focused on is the digesting of what is shifting fiscal policy,” said David Bianco, chief investment officer of the Americas at DWS Group. “We’re beginning to lose the anchor on some long-term key benchmark
interest rates.”
The spread between the rate on two- and 10-year notes has risen every single day this year as investors bet on additional US fiscal stimulus, spurring more bond issuance and higher yields on longer-maturity Treasuries.
In Washington, the House is set to issue a largely futile ultimatum to Vice President Mike Pence on Tuesday, demanding he invoke constitutional authority to remove President Donald Trump from office, as a prelude to an expected vote to impeach the president for the second time in little more than a year.
Malaysia’s stock benchmark slipped as much as 1.6% after the nation’s king declared a state of emergency until August.