NEW YORK,. Stocks dipped yesterday, dragging a global index into a fourth consecutive weekly loss, while the euro and sterling rallied against the dollar after a report said Britain is ready to drop a key Brexit demand.
Oil prices rose on signs of surging demand in China, although prices fell for a second week running as US inventories swelled.
Strong earnings boosted shares early on Wall Street but concerns over economic growth in China and Europe lingered, dragging indexes lower in afternoon trade.
“There a lot of cross-currents right now, with Italy, housing weakness, interest rates (rising) …,” said Michael Antonelli, managing director of institutional sales trading at Robert W. Baird in Milwaukee.
The pan-European STOXX 600 index lost 0.12 per cent and MSCI’s gauge of stocks across the globe shed 0.08 per cent.
The Dow Jones Industrial Average rose 64.89 points, or 0.26 per cent, to 25,444.34, the S&P 500 lost 1 point, or 0.04 per cent, to 2,767.78 and the Nasdaq Composite dropped 36.11 points, or 0.48 per cent, to 7,449.03.
Emerging market stocks were flat. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.13 per cent higher.
In currencies, the British pound and the euro rose after Bloomberg News reported that British Prime Minister Theresa May is ready to drop a key Brexit demand in order to make a deal for Britain to leave the European Union.
Earlier, EU negotiator Michel Barnier said a Brexit deal was 90 per cent done although hurdles remained.
Sterling was last trading at US$1.3068, up 0.39 per cent on the day. The euro rose 0.56 per cent to US$1.1516.
The dollar index fell 0.26 per cent.
The Mexican peso touched a five-week low versus the greenback after ratings agency Fitch revised Pemex’s credit rating outlook to negative citing uncertainty over the Mexican national oil company’s future business strategy.
Mexico’s currency lost 0.62 per cent versus the US dollar at 19.26. It earlier touched 19.34 per dollar, the weakest in five weeks.
The Japanese yen weakened 0.28 per cent versus the greenback at 112.50 per dollar.
Italian assets were sold heavily earlier in the session a day after the European Union called Rome’s draft budget an “unprecedented” breach of EU fiscal rules. The selling subsided after European Economics Commissioner Pierre Moscovici said he wanted to reduce budget tensions with Italy.
The closely watched Italian/German bond yield spread touched a 5-1/2-year high of 338.4 basis points before tightening to 306.8.
Italy’s benchmark 10-year bond yield rose as high as 3.783 per cent, the highest since February 2014. It last traded at 3.569 per cent.
Oil prices rose on signs of surging demand in China, but the market remained concerned over rising US inventories and trade wars that could curb economic activity.
US crude rose 0.95 per cent to US$69.30 per barrel and Brent was last at US$79.94, up 0.82 per cent on the day.
The benchmark US Treasury yield traded within the previous session’s range. The U.S 10-year note last fell 4/32 in price to yield 3.1902 per cent, from 3.175 per cent late on Thursday. — Reuters