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Bloomberg
Technology shares pushed major indexes higher after China ratcheted up stimulus measures to combat slowing growth.
Treasuries and the dollar advanced.
The S&P 500 rose for the first time in three sessions as senior Chinese officials vowed to cut taxes to boost the economy, lifting technology companies battered by concerns about the rising impact of the US-China trade war. Netflix Inc surged after it said it’s raising prices. Banking shares weighed on benchmarks after JPMorgan Chase & Co reported its worst quarter for bond trading in a decade. Adding to caution, the bank’s head Jamie Dimon warned that the ongoing government shutdown could cause a recession.
The 10-year Treasury yield fell below 2.70 percent, while the dollar gained against major peers. European stocks edged higher, while the euro dropped after German data confirmed the weakest year for growth since 2013. The pound fell as UK politicians prepared for a vote on Brexit. Oil rose above $51 a barrel.
The potential stimulus in China and warm welcome it received from markets reflects the delicate balance underpinning 2019’s risk-asset rebound: The same weak macro data that prompted a sell-off at the end of last year has the potential to spur looser monetary policies and therefore ignite a rally. Plenty of risks are clouding the outlook, not least the ongoing US shutdown and the increasingly frantic countdown to Brexit. Investors must also factor in corporate earnings as the results season gets underway.
Some of the world’s biggest banks announce earnings, including Bank of America, Morgan Stanley and Goldman Sachs. Alcoa, Indian IT company Mindtree, Netflix, Taiwan Semiconductor, American Express and BlackRock also post results.
The S&P 500 Index rose 0.5 percent in New York. The Stoxx Europe 600 Index rose 0.2 percent. Germany’s DAX Index declined 0.2 percent to the lowest in a week. The MSCI Asia Pacific Index rose 1.1 percent to the highest in almost six weeks. The MSCI Emerging Market Index gained 1.1 percent to the highest in six weeks.
The Bloomberg Dollar Spot Index climbed 0.1 percent to the highest in a week. The euro declined 0.2 percent to $1.1443, the weakest in more than a week. The British pound fell 0.2 percent to $1.2832. The Japanese yen dropped 0.3 percent to 108.44 per dollar, the biggest fall in more than a week.
The yield on 10-year Treasuries fell one basis point to 2.70 percent, the lowest in more than a week. Germany’s 10-year yield decreased two basis points to 0.21 percent, the lowest in more than a week. Britain’s 10-year yield declined four basis points to 1.257 percent, the largest drop in almost two weeks.
West Texas Intermediate crude climbed 1.8 percent to $51.42 a barrel. Gold fell 0.1 percent to $1,292.50 an ounce.