Monday , July 16 2018

S&P 500 on longest rally in month; Treasuries drop

Bloomberg

Stocks rose and Treasuries fell as a lull in the trade war gave investors room to focus on the start of the earnings season.
The S&P 500 Index gained for a fourth day, the longest streak since the beginning of June. PepsiCo Inc. jumped more than 3 percent after reporting better-than-forecast profit, bolstering optimism that Corporate America enjoyed a banner seconpd quarter. European shares advanced with help from energy firms as oil held near $74 a barrel. The dollar edged higher and the euro fell as investor confidence in the region soured.
Treasury yields advanced for a second session.
With fewer trade-war headlines rattling markets since July 6’s imposition of US and Chinese tariffs, investors turn their attention to earnings season in the hope that strong results can complement a recent run of positive economic data.
“The last couple days people have said, ‘Well, the tariffs went into effect on Friday, the world didn’t end,”’ JP Gravitt, chief executive officer and market strategist for Market Realist, said in an interview at Bloomberg’s New York headquarters. “Stocks are directionless, they just want the numbers.
They need the numbers right now because there’s a lot of stuff out there that we don’t know.”
Elsewhere, crude rose in New York as US stockpiles were seen declining for the fourth time in five weeks.
A basket of emerging-market currencies gained, while Turkey’s lira climbed after yesterday’s end-of-day tumble.
Earnings season gets going with JPMorgan and Citigroup among the largest companies due to give results, as well as India’s Infosys Ltd.
The most noteworthy US data may be the June inflation report on Thursday, which consensus expects will show both headline and core price growth picking up.
There’s another deluge of Treasury debt sales too, with a total $156 billion of notes and bills offered. Chinese trade data due at the end of the week will probably show slightly slower export growth, after early indicators pointed to softer overseas demand and weaker export orders, Bloomberg Economics said.
The S&P 500 Index climbed 0.4 percent in New York. The Stoxx Europe 600 Index rose 0.5 percent. The MSCI All-Country World Index gained 0.2 percent. The MSCI Emerging Market Index advanced
0.1 percent.
The Bloomberg Dollar Spot Index gained 0.2 percent, the largest rise in more than a week. The euro fell 0.4 percent to $1.1707, the biggest drop in more than a week.
The British pound gained 0.1 percent to $1.3271. The Japanese yen sank 0.4 percent to 111.30 per dollar.
The yield on 10-year Treasuries rose less than one basis point to 2.86 percent. Germany’s 10-year yield gained two basis points to 0.32 percent. Britain’s 10-year yield advanced four basis points to 1.293 percent.
The Bloomberg Commodity Index fell 0.4 percent. West Texas Intermediate crude rose 0.2 percent to $74.00 a barrel. Gold declined 0.3 percent to $1,253.84 an ounce.

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