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Stocks Drop From Record Highs; Bond Yields Rise: Markets Wrap

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Claire Ballentine and Kamaron Leach
·2-min read
Stocks Drop From Record Highs; Bond Yields Rise: Markets Wrap
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(Bloomberg) -- U.S. stocks retreated after climbing to an all-time high. Treasuries fell with the dollar. Oil rallied.

PayPal Holdings Inc. and Nvidia Corp. paced losses among tech companies in the S&P 500, which had fluctuated for much of Wednesday’s session as traders sifted through earnings from some of the world’s biggest banks. Bitcoin slid in the wake of the debut by cryptocurrency company Coinbase Global Inc. on the Nasdaq.

Read: Goldman, JPMorgan Traders Show the Reddit Crowd How It’s Done

With equities lingering near a record, investors are looking to the earnings season for further catalysts. Expectations of a strong profit rebound have helped markets rally, setting the bar high as reporting gets underway. More broadly, investors are monitoring vaccine developments for any threats to the economic recovery. The Federal Reserve said in its Beige Book that activity has picked up pace amid an improvement in consumer spending.

“You’re going to see this tug-of-war continue within markets as investors weigh the prospects of a strengthening economy with the risk of rising inflationary pressures,” said Adam Phillips, managing director of portfolio strategy at EP Wealth Advisors.

A quarter that began with retail investors declaring the end of the status quo on Wall Street just ended with big banks tallying surprisingly massive hauls. Goldman Sachs Group Inc. and JPMorgan Chase & Co. -- two of the most gilded names in finance -- kicked off bank earnings season with revenue windfalls from trading and dealmaking, defying warnings from within the industry that good times couldn’t last.

Goldman Sachs’s stock jumped, while JPMorgan’s slipped -- undermined by concern over weak demand for loans.

Some key events to watch this week:

U.S. data including initial jobless claims, industrial production and retail sales come Thursday.China economic growth, industrial production and retail sales figures are on Friday.

These are some of the main moves in financial markets:

Stocks

The S&P 500 fell 0.4% at 4 p.m. New York time.The Stoxx Europe 600 Index gained 0.2%.The MSCI Asia Pacific Index advanced 0.7%.

Currencies

The Bloomberg Dollar Spot Index fell 0.2%.The euro climbed 0.3% to $1.1979.The Japanese yen appreciated 0.2% to 108.89 per dollar.

Bonds

The yield on two-year Treasuries rose less than one basis point to 0.16%.The yield on 10-year Treasuries rose two basis points to 1.63%.The yield on 30-year Treasuries climbed two basis points to 2.31%.

Commodities

West Texas Intermediate crude gained 4.5% to $62.89 a barrel.Gold weakened 0.5% to $1,736.65 an ounce.

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