US equity markets hit new highs, treasury yields rise as week is choppy

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  • Wall Street closes at record highs
  • Flash PMI data mixed, COVID concerns hurt outlook
  • Fill up with oil; US Dollar, US Treasury Yields Rise

NEW YORK, July 23 (Reuters) – The three major U.S. stock indexes closed at record highs on Friday after an eventful week in which investors worried about the Delta coronavirus variant and applauded an economic recovery, while that US Treasury yields rose ahead of a Federal Reserve meeting next week.

Megacap tech stocks and positive corporate earnings helped push major US indices up. Yields on U.S. Treasuries were also on the rise, as was the dollar, with investors eyeing next week’s Federal Reserve meeting on clues to the U.S. economic recovery from the COVID-19 pandemic and on when the central bank will withdraw its support to the economy.

“It has certainly been a very good run. So far, it seems justified based on the strong earnings results. We have achieved interest rate stability, which has been helpful. As the economic recovery takes hold. continues, as long as people keep coming out despite the delta variant, we think stocks may go up, ”said Jeff Buchbinder, equity strategist for LPL Financial.“ We think the race will get more bumpy in the second half, but we believe the bull market is continuing. “

The Dow Jones Industrial Average (.DJI) gained 238.2 points, or 0.68%, to close the week at 35,061.55, while the S&P 500 (.SPX) gained 44.31 points, or 1 .01%, at 4,411.79. The Nasdaq Composite (.IXIC) added 152.39 points, or 1.04%, to close at 14,836.99.

The greenback posted a second week of gains on Friday after a few volatile days as risk appetite rose and fell.

The dollar index, which measures the greenback against a basket of six major currencies, was up slightly that day at 92.894. This was a 3.5 month high of 93.194 reached on Wednesday.

For the week, it was up 0.1%, after rising 0.6% previously. Read more

The 10-year T-bill yield hovered around 1.3%, nearly 17 basis points higher than a five-month low set on Tuesday, but still was in the low end of a recent range . The benchmark traded up 2.1 basis points to 1.288% after briefly surpassing 1.3%.

“We are ending the week with a very nice trade, and it is mainly driven by profits and profits especially in stocks that speak to the consumer, which is not a new story but it is a story that adds momentum to trade in the second half of the year, ”said Peter Kenny, founder of Kenny & Co LLC, the parent company of Strategic Board Solutions and Kenny’s Commentary, a political and economic newsletter aimed at subscribers .

After falling earlier in the trading session, oil should end the week slightly higher. Read more

Investors assume that “things will get better, travel is going to increase,” said Steve Massocca, managing director of Wedbush Securities. “There are concerns about the Delta variant.”

Massocca added: “If this thesis is put in jeopardy, it will put a stop to the ‘vertigo’ of the market.”

Some parts of the United States are re-implementing mask warrants due to new cases of COVID-19, while others have not, which is confusing. Read more

Business activity in the United States grew at a moderate pace for a second consecutive month in July amid supply constraints, suggesting a slowdown in economic activity, a report by data firm IHS revealed on Friday. Markit. Read more

Positive corporate earnings helped the stock market. American Express Co (AXP.N) jumped 1.7% after posting better-than-expected second-quarter earnings.

Social media companies Twitter Inc (TWTR.N) and Snap Inc (SNAP.N) gained 3.8% and 24.5% respectively, after their strong results.

Financial markets have swung from one direction to the other this week as investors attempt to assess what the burgeoning Delta variant means for the global economy.

After posting its biggest one-day drop since May on Monday, the S&P 500 stock index posted the biggest one-day jump since March a day later. The currency, bond and commodity markets experienced similar gyrations.

Reporting by Jessica DiNapoli; Additional reporting by Dhara Ranasinghe and Wayne Cole at Syndey; Editing by Ana Nicolaci da Costa, Will Dunham, Pravin Char, Dan Grebler and Raissa Kasolowsky

Our Standards: Thomson Reuters Trust Principles.


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