Stocks Hover Around Record; Treasury Yields Steady: Markets Wrap

(Bloomberg) -- Markets settled into a holding pattern on Wednesday, with global stocks hovering around all-time highs as investors awaited details of the Federal Reserve’s most recent meeting.

Futures on the S&P 500 and Nasdaq 100 struggled for direction, while the 10-year Treasury yield was steady. The dollar halted a four-day slide.

The Stoxx Europe 600 index edged lower, with Prosus NV dropping as much as 5% after it announced plans to cut its stake in Chinese online giant Tencent Holdings Ltd. Amundi SA gained 3% after agreeing to buy Societe Generale SA’s fund management arm Lyxor. Bond yields across the euro region ticked lower.

Expectations for continued central-bank support and the strongest world expansion in at least four decades have driven stock benchmarks to unprecedented heights. Concerns about higher borrowing costs destabilizing the market have eased, with bond yields subsiding as traders pull their more-aggressive positioning for Fed policy tightening. Minutes of the last Fed rates meeting later Wednesday may provide more clues on the outlook.

“We continue to expect equity prices and U.S. long-term yields to increase further over the coming months, as real growth and inflation data picks up especially in the U.S.,” said Xavier Chapard, a global macro strategist at Credit Agricole SA. “In the short term they could remain range-bound as a lot of good news is in the prices.”

Oil held around $59 a barrel amid optimism that the economic expansion will pick up. The International Monetary Fund upgraded its global growth forecast while warning about a divergence between advanced and less-developed economies.

Some key events to watch this week:

• The 2021 Spring Meetings of the IMF and the World Bank Group take place virtually. Federal Reserve Chairman Jerome Powell takes part in a panel about the global economy on Thursday.
• The Fed publishes minutes from its March meeting on Wednesday.
• Japan releases its balance of payments numbers Thursday.
• China’s consumer and producer prices data are due Friday.

These are some of the main moves in markets:

Stocks

• S&P 500 futures were little changed as of 7:14 a.m. in New York. Nasdaq 100 futures were flat.
• The Stoxx Europe 600 dipped 0.1%.
• MSCI’s Asia Pacific Index was little changed.
• MSCI’s Emerging Markets Index dropped 0.3%.

Currencies

• The Bloomberg Dollar Spot Index rose less than 0.1%.
• The euro gained 0.1% to $1.1888.
• The British slipped 0.1% to $1.3812.
• The yen was little changed at 109.81 per dollar.

Bonds

• The yield on 10-year Treasuries was little changed at 1.66%.
• Germany’s 10-year yield dipped two basis points to -0.33%.
• The U.K. 10-year yield fell one basis point to 0.78%.

Commodities

• West Texas Intermediate crude climbed 0.7% to $59.75 a barrel.
• Gold dipped 0.4% to $1,735.93 an ounce.

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