Stocks Rise, Bonds Slip as Trump Team Eases Stance: Markets Wrap

• April 04 2018
• Jeremy Herron, Sarah Ponczek

U.S. stocks rose as White House officials continued to signal that the president’s tough talk on trade won’t lead to growth-sapping tariffs. Gold declined and bonds dropped in most developed markets.

U.S. stocks rose as White House officials continued to signal that the president’s tough talk on trade won’t lead to growth-sapping tariffs. Gold declined and bonds dropped in most developed markets.

The S&P 500 Index pushed higher as investors grew more confident the administration’s protectionist rhetoric wouldn’t result in equally stringent policy. The measure is now higher for the week after trade concern led to a selloff Monday. Markets turned calmer ahead of Friday’s jobs report. The dollar strengthened for the third time this week, while the 10-year Treasury yield popped above 2.81 percent.

“After the initial introduction of trade tensions and the back and forth between the U.S. and China and consternation around Nafta, I think the markets are now beginning to see through the bluster of negotiations and they’re dialing back some of their most significant fears of a full on trade war,” Kevin Caron, a senior portfolio manager at Washington Crossing Advisors, said by phone.

European equities caught up to the American rebound, surging the most in two months as every sector rallied. The pound fell after purchasing managers’ data for February disappointed. Asia’s major stock gauges all rose, although markets in China and Hong Kong were closed for holidays.

Stocks regained a measure of poise after representatives from the U.S. and China left the door open for a negotiated solution to avoid tariff proposals that aren’t set to take effect for several months. Federal Reserve officials said it’s premature to fully assess the impact of the trade dispute, which is adding uncertainty to an otherwise bright economic outlook. A board member, Lael Brainard, said trade policy is “certainly something that I take into account, in thinking about risks.”

Meanwhile, Facebook Inc. climbed as traders took in stride a company disclosure that data on most of its 2 billion users could have been harvested improperly by third parties. Investors are cautiously returning to technology shares after a selloff last month gave momentum to a global equity correction.

Elsewhere, Australia’s dollar led declines against the greenback after the country’s money-market rate fell for the first time in almost two months. Oil reversed a gain and Bitcoin held below $7,000.

Terminal users can read more in our markets live blog.

Here are some key events for the remainder of this week:

• On Friday, America publishes non-farm payrolls and an employment report; the jobless rate was forecast to have fallen in March after holding at 4.1 percent for five straight months.

And these are the main moves in markets:

Stocks

• The S&P 500 rose 0.5 percent at 10:33 a.m. in New York.
• The Nasdaq 100 Index jumped 0.9 percent.
• The Stoxx Europe 600 Index surged 1.9 percent, hitting the highest in more than two weeks.
• The MSCI All-Country World Index climbed 0.4 percent.
• The MSCI Emerging Market Index jumped 0.8 percent.
• The MSCI Asia Pacific Index increased 0.6 percent.

Currencies

• The Bloomberg Dollar Spot Index rose 0.3 percent on the biggest advance in more than a week.
• The euro decreased 0.2 percent to $1.2248, the weakest in more than two weeks.
• The British pound fell 0.4 percent to $1.4016, the biggest fall in more than a week.
• The Japanese yen declined 0.3 percent to 107.08 per dollar, the weakest in more than five weeks.

Bonds

• The yield on 10-year Treasuries climbed one basis point to 2.81 percent, the highest in more than a week.
• Germany’s 10-year yield climbed two basis points to 0.52 percent on the largest surge in more than two weeks.
• Britain’s 10-year yield climbed three basis points to 1.401 percent on its fifth straight advance.

Commodities

• West Texas Intermediate crude decreased 0.3 percent to $63.19 a barrel.
• Copper surged 1.4 percent to $3.05 a pound, the biggest jump in almost four weeks.
• Gold dipped 0.5 percent to $1,327.15 an ounce.

— With assistance by Lu Wang, and Todd White