M&A Spurs Stocks Gains as Earnings Eyed: Markets Wrap

Stocks wavered as the possibility of further Federal Reserve policy tightening lifted Treasury yields and investors stayed on the sidelines amid bank earnings.

The S&P 500 was little changed. Two-year rates climbed to around 4.1% as investors scaled back expectations for rate cuts later in the year. New York state manufacturing activity unexpectedly expanded in April for the first time in five months as new orders and shipments snapped back.

Charles Schwab Corp. fell after the firm said deposits continued to erode in the first quarter and that it was halting share repurchases amid the worst US banking crisis since 2008. State Street Corp. dropped as it reported clients retreated from its investment products.

“The current season’s earnings profile is rather opaque,” said Peter Kinsella, head of FX strategy at Swiss asset manager UBP. “The banks last week did better than expected, but we have to see what the reporting season will be like from everyone else. But the S&P is expensive at current levels so you have to ask yourself if there is really much material upside from here.”

Key events this week:

• China GDP, retail sales, industrial production, Tuesday
• US housing starts, Tuesday
• Goldman Sachs and Bank of America release first-quarter earnings, Tuesday
• Fed’s Michelle Bowman discusses digital currency, Tuesday
• Eurozone CPI, Wednesday
• Fed releases Beige Book, Wednesday
• Fed’s John Williams gives a speech, Wednesday
• Fed’s Austan Goolsbee is interviewed on NPR, Wednesday
• China loan prime rates, Thursday
• Eurozone consumer confidence, Thursday
• US initial jobless claims, existing home sales, index of leading economic indicators, Thursday
• ECB issues report on March policy meeting, Thursday
• Fed’s Christopher Waller speaks at cryptocurrency-focused event, Thursday
• Fed’s Patrick Harker speaks on “monetary policy and housing”, Thursday
• Fed’s Loretta Mester discusses the economic and policy outlook, Thursday
• Fed’s Raphael Bostic discusses regional and national economic conditions, Thursday
• Fed’s Michelle Bowman and Lorie Logan speak at event, Thursday
• PMIs for Eurozone, Friday
• Japan CPI, Friday
• Fed’s Lisa Cook discusses economic research at an event, Friday

Some of the main moves in the market:

Stocks

• The S&P 500 was little changed as of 9:31 a.m. New York time
• The Nasdaq 100 fell 0.2%
• The Dow Jones Industrial Average was little changed
• The Stoxx Europe 600 was little changed
• The MSCI World index was little changed

Currencies

• The Bloomberg Dollar Spot Index rose 0.3%
• The euro fell 0.4% to $1.0947
• The British pound was little changed at $1.2405
• The Japanese yen fell 0.4% to 134.26 per dollar

Cryptocurrencies

• Bitcoin fell 3.2% to $29,386.44
• Ether fell 2.7% to $2,065.14

Bonds

• The yield on 10-year Treasuries advanced four basis points to 3.56%
• Germany’s 10-year yield advanced three basis points to 2.47%
• Britain’s 10-year yield was little changed at 3.67%

Commodities

• West Texas Intermediate crude fell 0.6% to $82.01 a barrel
• Gold futures fell 0.1% to $2,013.10 an ounce

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