US stock gains fade on mixed earnings; bonds retreat

Bloomberg

US stocks faltered in their pursuit of all-time highs as investors sifted through a group of high-profile earnings for clues on the strength of the American economy. The 10-year Treasury yield reached its highest level since the March Federal Reserve meeting.
The S&P 500 failed to hold its six-month high after UnitedHealth Group Inc erased a gain that topped 3 percent. The Nasdaq 100 briefly topped above its closing record, with Netflix adding 2.5 percent before it reports results later. Johnson & Johnson and BlackRock Inc advanced after strong earnings. Bank of America Corp slipped on slower net interest income growth. JB Hunt Transport Services Inc dragged trucking companies lower after its profit disappointed.
Treasuries continued to slump, with rates reclaiming levels last seen before the Fed’s dovish tilt a month ago. In Europe, equities climbed for a fifth day, driven by insurance and
financial services firms.
In Asia, shares in China and Hong Kong outperformed markets in Japan and South Korea. The euro pared a decline after Bloomberg reported that European Central Bank officials are said to lack enthusiasm for any revamp of their negative-interest rate tool.
Investors are spending the holiday-shortened week assessing the chances that stocks will sustain their rally even as similar gains in global investment-grade bonds have ebbed since late March.
Optimism over earnings appears to be boosting bullish sentiment in equities, though volumes have been muted.
Central banks are also in the frame, with Chicago Fed President Charles Evans, who currently sees rates on hold until the fall of 2020, saying that the nation’s central bank may need to cut them if inflation falls.
Officials from Australia, New Zealand and Japan also
indicated appetite to support growth through monetary
policy. Elsewhere, oil held near the lowest in a week in New York on estimates that US crude inventories increased again.
Emerging-market stocks climbed, though the currencies weakened.
Earnings season rolls on this week, with reports due from: Morgan Stanley, American Express, Netflix, IBM, United Continental, PepsiCo, Honeywell, Alcoa and Taiwan Semiconductor. Wednesday brings China GDP, industrial production and retail sales data.
Stock markets will be closed for Easter holidays in countries including the US, UK and Germany on Friday.
The S&P 500 rose 0.1 percent in New York. The Dow was up 0.1 percent and the Nasdaq 100 Index climbed 0.3 percent. The Stoxx Europe 600 Index increased 0.3 percent. The MSCI Emerging Market Index rose 0.4 percent, the largest advance in a week. The MSCI Asia Pacific Index climbed 0.3 percent to the highest in more than six months.
The Bloomberg Dollar Spot Index increased 0.1 percent to the highest in more than a week. The euro fell less than 0.05 percent to $1.1303. The British pound declined 0.2 percent to $1.3076. The Japanese yen climbed less than 0.05 percent to 112.01 per dollar.
The yield on 10-year Treasuries increased three basis points to 2.58 percent, the highest in four weeks.
Germany’s 10-year yield climbed one basis point to 0.07 percent, the highest in almost four weeks. Britain’s 10-year yield rose one basis point to 1.225 percent, the highest in almost six weeks.
West Texas Intermediate crude climbed 0.6 percent to $63.77 a barrel. Gold futures fell 1 percent to $1,278.20
an ounce.