U.S. stocks fell amid disappointing earnings and the 10-year Treasury yield held near 3.1 percent as global markets continue to grapple with the outlook for the world’s largest economy. Brent crude punched through $80 a barrel.
The S&P 500 Index retreated as results from Cisco Systems Inc. weighed on technology shares and Walmart Inc. dragged on consumer stocks. The dollar added to its highest levels of the year after data on manufacturing and employment showed economic strength. West Texas oil climbed above $72 a barrel and Brent hit its highest in four years.
In Europe, the common currency euro was slightly weaker and Italian bonds dropped as party leaders sealed an agreement to form a populist government. The pound jumped but then pared gains amid conflicting reports over Britain’s future in the EU customs union. The Stoxx Europe 600 Index advanced. Earlier in Asia equities rose in Japan and fell in Australia and Korea.
Recent evidence that the world’s largest economy will continue to pick up steam is currently just a consolation prize for investors, who are having to adjust to the highest U.S. bond yields in years as well as second-guess issues stretching from peace on the Korean peninsula to Italian populists forming a government. Looming over it all are trade talks between the U.S. and China, the outcome of which could cement the global growth story — or derail it.
Elsewhere, the Turkish lira deepened its losses, while emerging-market stocks slipped.
Terminal users can read more in our markets live blog.
These are some key events to watch this week:
- Cleveland Fed President Loretta Mester speaks on monetary policy at an ECB conference in Frankfurt on Thursday.
- Chinese Vice Premier Liu He is expected in Washington for more trade talks.
And these are the main moves in markets:
- The S&P 500 fell 0.2 percent at 9:47 a.m. in New York.
- Cisco fell 4 percent, the most in six weeks.
- The Nasdaq Composite Index slipped 0.3 percent.
- The Stoxx Europe 600 Index increased 0.3 percent to the highest in 15 weeks.
- Germany’s DAX Index rose 0.3 percent to the highest in 15 weeks on the biggest advance in a week.
- The MSCI Emerging Market Index sank 0.5 percent to the lowest in more than a week.
- The MSCI Asia Pacific Index declined 0.2 percent to the lowest in a week.
- The Bloomberg Dollar Spot Index rose 0.1 percent to the highest in 20 weeks.
- The euro dipped less than 0.05 percent to $1.1803, the weakest in five months.
- The British pound rose 0.1 percent to $1.3504.
- The Japanese yen decreased 0.3 percent to 110.71 per dollar, the weakest in more than 16 weeks.
- The Turkish lira sank 0.8 percent to 4.4485 per dollar, the weakest on record.
- The yield on 10-year Treasuries was unchanged at 3.10 percent, the highest in about seven years.
- Germany’s 10-year yield gained two basis points to 0.62 percent.
- Britain’s 10-year yield climbed three basis points to 1.503 percent, the highest in more than three weeks.
- Italy’s 10-year yield rose two basis points to 2.135 percent, the highest in about seven months.
- West Texas Intermediate crude increased 0.9 percent to $72.11 a barrel, the highest in more than three years.
- Gold dipped 0.1 percent to $1,289.88 an ounce, the weakest in 20 weeks.
- Brent crude gained 0.8 percent to $79.92 a barrel, the highest in more than three years.
— With assistance by Andreea Papuc, and Sheldon Reback