While you were sleeping: US Treasuries gain, Wall St mixed
By Margreet Dietz
Dec. 7 (BusinessDesk) - US Treasuries rose, while Wall Street was mixed as investors eyed the latest on US tax reform plans and Brexit talks.
Meanwhile, the latest US jobs data offered further evidence of strength. An ADP Research Institute report showed private US employers added 190,000 workers to their payrolls in November.
Economists in separate polls by Bloomberg and Reuters predict the government's nonfarm payrolls report, due Friday, will show an increase of 200,000 and 190,000 jobs respectively.
“The job market is red hot, with broad-based job gains across industries and company sizes,” Mark Zandi, chief economist at Moody’s Analytics in West Chester, Pennsylvania, said in a statement. “The only soft spots are in industries being disrupted by technology, brick-and-mortar retailing being the best example. There is a mounting threat that the job market will overheat next year.”
In 1.41pm trading in New York, the Dow Jones Industrial Average eked out a 0.06 percent gain, while the Nasdaq Composite Index rose 0.2 percent. However, in 1.26pm trading, the Standard & Poor’s 500 Index edged 0.03 percent lower.
Investors are “locking in profits earlier than usual for the year and not opening any new positions,” Andrew Clarke, director of trading at Mirabaud (Asia), told Bloomberg. “Eventually, as profit taking subsides, buying for the new year will appear as people look toward 2018.”
The Dow rose as gains in shares of Microsoft and those of Visa, recently up 1.4 percent and 1 percent respectively, outweighed falls in shares of Merck and those of Home Depot, recently down 2.5 percent and 1.2 percent respectively.
US Treasuries rose, pushing yields on the 10-year note three basis points lower to 2.32 percent.
Also, the Treasury yield curve flattened, with the spread between five- and 30-year US yields narrowing to 58 basis points as the market prices in more rate hikes from the Federal Reserve next year, according to Bloomberg.
Oil declined more than 2 percent after a report showed an unexpected gain in US inventories of gasoline supplies.
“Gasoline inventories are also now building as demand eases back even in the face of decent export numbers,” David Thompson, executive vice-president at Powerhouse, an energy-specialized commodities broker in Washington, told Reuters. “Gasoline futures have clearly broken technical support levels and ULSD (diesel) futures are testing them.”
In Europe, the Stoxx 600 Index ended the session with a 0.1 percent decline from the previous close. Germany’s DAX Index fell 0.4 percent, while France’s CAC 40 Index edged 0.02 percent lower.
The UK’s FTSE 100 Index rose 0.3 percent.
UK Prime Minister Theresa May is facing an impasse in her efforts to negotiate a Brexit deal.
Northern Ireland’s Democratic Unionist Party thinks it will be challenging to get a deal done this week as it’s demanding significant changes to a text on what the Irish border should look like after Brexit, Bloomberg reported, citing a person familiar with the party’s thinking.