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Bloomberg
US equities advanced alongside stocks in Europe as traders weighed the latest corporate earnings and moves to end the American government shutdown against lingering doubts over trade. The dollar’s six-day rally stalled and Treasury yields rose.
The S&P 500, Dow Jones and Nasdaq indexes all opened higher after IBM topped profit estimates and Procter & Gamble increase the upper end of its sales forecast. The Stoxx Europe 600 Index reversed an early decline as positive reports from Carrefour SA and Ahold boosted retailers. Shares were mixed in Asia. The yen slid as the Bank of Japan cut its inflation outlook. The VIX gauge of expected volatility of the S&P 500 gave back some of Tuesday’s jump.
“Risk premia are quite high, so I think the markets are pricing quite a lot of uncertainty — and probably too much uncertainty on the economic front, which is why we’ve seen this
recent rally,†said Peter Oppenheimer, chief global equity strategist at Goldman Sachs.
Doubts over foreign trade and politics continue to permeate global markets. White House adviser Lawrence Kudlow said that negotiations between the US and China next week will be “determinative,†leaving traders on edge about the prospects for a deal. Meanwhile, the Senate is set to vote on Thursday on legislation to reopen the government, though it’s not clear that any measures will pass.
Earnings from corporate behemoths including Ford, were due on Wednesday.
Elsewhere, WTI oil climbed above $53 a barrel. The pound strengthened for a third day after signs emerged that the UK Parliament is moving closer to a plan for delaying Brexit.
Earnings season is in full swing: Texas Instruments and Ford are among companies posting results this week. The World Economic Forum, the annual gathering of global leaders in politics, business and culture, continues in Davos, Switzerland.
The S&P 500 Index rose 0.5 percent in New York, while Nasdaq Composite Index gained 0.5 percent and the Dow Jones Industrial Average edged 0.9 percent higher. The Stoxx Europe 600 Index rose 0.5 percent. The UK’s FTSE 100 Index dipped 0.4 percent. Germany’s DAX Index rose 0.4 percent. The MSCI Emerging Market Index was
little changed.
The Bloomberg Dollar Spot Index fell less than 0.1 percent, the first drop in seven days. The euro was little changed at $1.1360. The British pound increased 0.7 percent to $1.3044, the third straight gain. The yield on 10-year Treasuries rose three basis points to 2.77 percent.