US treasuries gain as health vote looms

Bloomberg

Markets struck a cautious tone, with US stocks fluctuating and Treasuries gaining a fifth day, as investors watched developments in Washington for clues on the prospects for the Trump administration’s pro-growth policies.
The S&P 500 Index was little changed, as futures erased gains after House Republicans postponed a planned meeting on the health-care bill. The measure’s outcome is in doubt, and investors have speculated failure to pass could delay promised tax and spending reforms. Treasury 10-year yields fell to 2.39 percent, while the yen strengthened for an eighth day, the longest streak in six years. The pound climbed to the highest level in a month against the dollar following a rebound in UK retail sales in February.
The reflation trades sparked by Trump’s election have faltered in March as the
administration remains far from delivering on pro-growth policies that boosted stocks and the dollar.
“The reflation rally in the US stock markets appeared to have topped in March, causing a pullback after four months of unprecedented rise,” Ipek Ozkardeskaya, a market analyst at London Capital Group Ltd., wrote in a note. “Trump’s failure to push his plans through Congress dented investors’ appetite. Any positive news from today’s vote has the potential to revive the stock bulls.”
Voting on the Republican health bill will go down to the wire, with more GOP representatives defecting. The timing of the vote has not been set. Francois Fillon may find a TV interview tonight a bit of an ordeal, given the allegations that have plagued his campaign.
The S&P 500 Index fell 0.1 percent to 2,345.57 at 9:35 a.m. in New York. The Stoxx Europe 600 Index added 0.2 percent as of 8:49 a.m. in New York, snapping three days of declines. Miners added 0.8 percent. Emerging market stocks added 0.1 percent.
The Bloomberg Dollar Spot Index rose less than 0.1 percent after six days of losses. The pound climbed 0.1 percent to $1.2492 after a report showed retail sales rose 1.4 percent in February after sliding a revised 0.5 percent the previous month. The euro weakened 0.2 percent to $1.0777.