US equities mixed, dollar falls; Treasuries advance

Bloomberg

US equities fluctuated near records as investors weighed expectations for easier monetary policy against concerns about a slowing economy. Treasuries gained, while the dollar edged lower.
The S&P 500 was mixed, hovering just under all-time highs reached during last week’s rally. Tech shares led gains, while healthcare paced falling stocks. Bristol-Meyers Squibb Co tumbled after saying it will divest a top drug to get approval to merge with Celgene Corp. European shares fell, dragged lower by carmakers as Daimler AG cut its profit forecast for the third time in a year.
Investors in risk assets have continued to shrug off signs of a global economic slowdown and focus on the increasingly dovish tone at central banks around the world. That attention will intensify on Tuesday when Fed Chair Jerome Powell discusses monetary policy. But sentiment could be at a crossroads as the conflict between the America and Iran has ramped up, and the meeting between China’s President Xi Jinping and Donald Trump at the Group of 20 conference in Japan presents a pivot point for trade relations between the two countries.
The 10-year Treasury yield dropped to 2.02 percent, while West Texas crude traded at $57 a barrel. The euro touched a three-month high against the dollar even as data showed that a slump in German business confidence deepened in June.
It’s “a pretty good guess that we won’t see a whole lot of movement in front of the big upcoming meetings (G20 and OPEC),” wrote Matt Maley, equity strategist at Miller Tabak & Co. “Given the meeting between President Trump & President Xi at the one and the impact the situation with Iran could/should have on the other, the results of those meetings should be quite important to the stock market’s next move.”
Elsewhere, the Australian dollar rose after Reserve Bank of Australia Governor Philip Lowe said there are limits to what monetary easing can achieve. Gold extended its advance above $1,400 an ounce, while Bitcoin surged towards 11,000. Fed Chairman Jerome Powell speaks at the Council on Foreign Relations in New York on Tuesday. He’ll discuss the challenges facing the US economy.
MSCI Inc announces results of its 2019 Market Classification Review on Tuesday, including whether Kuwait gets upgraded from frontier to emerging-market status. The Group of 20 summit is in Osaka, Japan on Friday and on Saturday.
The S&P 500 Index was little changed in New York. The Stoxx Europe 600 Index decreased 0.2 percent to the lowest in a week. The MSCI Emerging Market Index advanced less than 0.05 percent.
The Bloomberg Dollar Spot Index dropped 0.1 percent. The euro rose 0.2 percent to $1.1388, the strongest in almost 14 weeks. The British pound fell 0.2 percent to $1.2715. The Japanese yen fell 0.1 percent to 107.47 per dollar.
The yield on 10-year Treasuries dipped two basis points to 2.03 percent. Germany’s 10-year yield declined two basis points to -0.31 percent. Japan’s 10-year yield advanced less than one basis point to -0.154 percent.