New York: US stocks retreated as traders remained on edge after Fridayâ€™s rout. Treasuries climbed and the dollar steadied.
Technology companies and banks in the S&P 500 Index fell. Ten-year Treasury yields traded near the lowest in more than 15 months after a closely-watched part of the US curve inverted last week as investors wager the Federal Reserve will need to cut rates. The greenback dropped against most of its Group-of-10 peers, while the pound turned lower after Prime Minister Theresa May stumped for her Brexit deal before a parliamentary vote.
The risk rally has come under scrutiny after stock valuations climbed near levels reached during the height of last yearâ€™s euphoria. While weakening data and a pivot by global central banks away from tighter policy is shaking confidence, a breakthrough in US-China trade talks could provide support going forward. Investors also digested news that Special Counsel Robert Mueller found no evidence anyone close to Donald Trump colluded with Russia in the 2016 presidential campaign.
â€œItâ€™s mildly positive for risk assets, but only very mildly and not nearly enough to overcome skittishness and downward pressure from continued weakness in global economic data,” said Aaron Hurd, a senior portfolio manager in the currency group at State Street Global Advisors, whose team manages $104 billion.
The pound retreated as May said she doesnâ€™t yet have enough support to put her Brexit deal to a vote in Parliament and will continue to try to convince MPs to back it. The European Union said itâ€™s now prepared to handle the impact of the UK leaving without an agreement, a scenario it described as â€œincreasingly likely.”
European shares dropped even after data showed confidence among German companies improved. Australiaâ€™s 10-year bond yield recorded an all-time low and Japanâ€™s hit the lowest since September 2016. The Turkish lira recouped some of its Friday slump, which followed the start of an investigation by the countryâ€™s banking regulator into JPMorgan Chase & Co. and another probe of unspecified banks for stoking the currencyâ€™s plunge.
These are the main moves in markets:
The S&P 500 Index dipped 0.3% to 2,792.35 at 12:44 pm in New York. The Stoxx Europe 600 Index declined 0.4% to the lowest in almost two weeks. The MSCI Asia Pacific Index dipped 1.9%. The MSCI Emerging Market Index fell 1.2%.
The Bloomberg Dollar Spot Index dipped 0.1%. The euro rose 0.1% to $1.1316. The British pound decreased 0.2% to $1.3176. The Japanese yen declined 0.1% to 110.02 per dollar.
The yield on 10-year Treasuries fell three basis points to 2.41%. Britainâ€™s 10-year yield fell three basis points to 0.982%. Germanyâ€™s 10-year yield dipped one basis point to -0.03%.
The Bloomberg Commodity Index gained 0.2%. West Texas Intermediate crude dipped 0.1% to $58.98 a barrel. Gold rose 0.7% to $1,322.41 an ounce.