US stocks start may lower, with eyes on Apple; dollar rallies

Bloomberg

US stocks opened lower on Tuesday, when much attention will be focused on Apple Inc.’s earnings report after the close. The dollar extended its rally, while UK equities climbed during a lackluster session in which many major markets were closed.
The S&P 500 Index fell in morning trading, with industrial and energy stocks leading a broad-based, if shallow, decline as US manufacturing expanded at its slowest pace since July. Tech shares including Apple bucked the downward trend. Ten-year Treasury yields held below 3 percent as the greenback headed for its ninth gain in 11 days, with that strength weighing on most commodities.
Sterling slumped after UK manufacturing slowed more than predicted. That spurred the FTSE, one of the few European equity gauges trading, to rise a fourth day. Broader European benchmarks were flat, as businesses warned of market uncertainty following the Trump administration’s decision to delay US steel and aluminum tariffs.
Markets were shut for holidays in countries including Germany, France, Italy, Spain, China, Hong Kong, Singapore and India.
For all the interest in company earnings, another big focus this week is likely to be central bank policy and economic data. Investors will watch the Federal Reserve meeting closely for any signals that policy makers will raise interest rates another three times this year. With the dollar ticking higher, foreign-exchange traders are also asking whether the US currency’s bout of strength has legs or will fade as sellers emerge at key technical levels.
Elsewhere, West Texas oil retreated, erasing Monday’s gain. Gold fell again, heading for the lowest since December. The Australian dollar declined after the central bank maintained its policy stance amid below-target inflation and constrained household spending.
The Federal Open Market Committee begins a two-day meeting on Tuesday. The rates decision is Wednesday. The European Commission presents its spring economic forecasts, which include projections for growth, inflation, debt and deficit.
Payroll gains in the US probably picked up in April, with the unemployment rate forecast to drop to 4 percent, according to surveys of economists. Earnings season continues, with Apple Inc. headlining. Other high profile results include Pfizer Inc., HSBC Holdings Inc. and Tesla Inc.
The S&P 500 Index declined 0.3 percent in New York. The Nasdaq 100 Index gained 0.2 percent. The UK’s FTSE 100 Index rose 0.2 percent to the highest in almost three months. The MSCI Emerging Market Index decreased 0.4 percent.
The Bloomberg Dollar Spot Index increased 0.6 percent to the highest in almost 16 weeks. The euro declined 0.7 percent to $1.1989, the weakest in almost 16 weeks. The British pound fell 1 percent to $1.3626. The Japanese yen decreased 0.4 percent to 109.76 per dollar, the weakest in more than 12 weeks. The yield on 10-year Treasuries increased two basis points to 2.98 percent. Britain’s 10-year yield fell one basis point to 1.41 percent, its sixth straight decline.
West Texas Intermediate crude fell 1.4 percent to $67.58 a barrel. Gold dropped 0.8 percent to $1,304.15 an ounce, the weakest in four months.