(Bloomberg) — U.S. stocks climbed from the lowest levels of the day as traders weighed disappointing earnings and bond-market gyrations sparked by concerns over inflation and monetary tightening. The dollar strengthened the most in a month.
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The S&P 500 and Nasdaq 100 had retreated with Amazon.com Inc. and Apple Inc. slumping after reporting underwhelming results on Thursday. The Dow Jones Industrial Average turned positive, led higher by Microsoft Corp. and Visa Inc.
“Front and center are the results from Apple and Amazon yesterday missing expectations, but more importantly the commentary about the supply chains,” said Cliff Hodge, chief investment officer at Cornerstone Wealth Group.
Yields on shorter-maturity Treasuries rose more than long-dated issues. Inflation pressures and the prospect of interest-rate hikes are whipsawing bond markets. The U.S. dollar ticked up from a one-month low and crude oil fluctuated.
The Stoxx Europe 600 Index erased losses, but ws still on pace for its fourth straight weekly advance.
European bonds extended Thursday’s retreat as data on Eurozone economic growth and inflation topped analysts’ estimates, reinforcing growing conviction that interest-rate increases are on the horizon after European Central Bank President Christine Lagarde offered only mild pushback against traders’ bets on a hike as soon as October next year. The euro slipped after jumping 0.7% on Thursday, but remains on track for a third week of gains.
Markets are grappling with a number of crosscurrents. Generally positive corporate performance has helped to underpin global equities. But inflation risks from supply-chain snarls and costlier raw materials are boosting expectations for rate hikes and dimming the economic outlook.
“Almost any data series you look at, be it the bond market, be it inflation, GDP, the labor market, anything is still showing these signs of fibrillation and that’s going to take some time to sort out,” said Scott Clemons, chief investment strategist at Brown Brothers Harriman, on Bloomberg Radio and TV’s “Surveillance.”
The latest data showed U.S. growth slowed more than expected in the third quarter, hampered by supply chains and a surge in Covid-19 cases. Separate report showed that weekly jobless claims fell to a pandemic low, and personal spending slowed in line with analysts’ estimates in September.
In cryptocurrencies, Bitcoin retreated below $58,000 during a sharp swoon in U.S. trading. The largest token rebounded to around $61,000. Ether, the second largest, rallied to a record high.
Here are some events to watch this week:
For more market analysis, read our MLIV blog.
These are the main moves in markets:
Stocks
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The S&P 500 was little changed as of 11:18 a.m. New York time
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The Nasdaq 100 fell 0.2%
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The Dow Jones Industrial Average rose 0.2%
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The Stoxx Europe 600 was little changed
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The MSCI World index fell 0.4%
Currencies
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The Bloomberg Dollar Spot Index rose 0.7%
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The euro fell 1% to $1.1565
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The British pound fell 0.7% to $1.3698
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The Japanese yen fell 0.4% to 114.04 per dollar
Bonds
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The yield on 10-year Treasuries was little changed at 1.58%
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Germany’s 10-year yield advanced five basis points to -0.09%
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Britain’s 10-year yield advanced four basis points to 1.05%
Commodities
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West Texas Intermediate crude fell 0.4% to $82.48 a barrel
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Gold futures fell 1.4% to $1,776.80 an ounce
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