US stocks end higher, Treasury yields rise on easing credit, trade worries
NEW YORK, Oct 17 (Reuters) – Wall Street stocks advanced and U.S. Treasury yields rebounded on Friday as investors assessed the health of regional banks and President Donald Trump said his face-to-face trade talks with Chinese President Xi Jinping were still on.
All three major U.S. stock indexes closed in positive territory after struggling for direction in early trading, and all three notched weekly gains.
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Benchmark Treasury yields and the dollar turned higher, while gold pulled back after a record run sent the precious metal to all-time highs.
“It took a night to sleep on it, but some calm has come in over the probably overblown worries in the regional bank area,” said Ryan Detrick, chief market strategist at Carson Group in Omaha. “The truth is the financial sector is likely still on firm footing; just a couple companies had some bad news, but it’s not systemic.”
“We’ve seen this movie before,” Detrick added. “A week ago, President Trump was talking 100% tariffs and the market had its worst selloff in months and now today he’s clearly putting some water on that fire, saying he and President Xi have a good relationship.”
The first official week of the third-quarter earnings season is in the books, with 58% of companies in the S&P 500 having reported. Of those, 86% have delivered stronger-than-expected results. Analysts now expect third-quarter S&P 500 earnings growth of 9.3% year-on-year, up from 8.8% as of October 1, according to LSEG data.
Item 1 of 4 Traders work on the floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S., December 21, 2016. REUTERS/Andrew Kelly
The yield on benchmark U.S. 10-year notes rose 2.9 basis points to 4.005%, from 3.976% late on Thursday.
The 30-year bond yield rose 1.7 basis points to 4.6005% from 4.583% late on Thursday.
The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 3.3 basis points to 3.459%, from 3.426% late on Thursday.
The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, rose 0.16% to 98.42, with the euro down 0.15% at $1.1669.
Against the Japanese yen , the dollar strengthened 0.04% to 150.48.
U.S. crude rose 0.14% to settle at $57.54 per barrel, while Brent settled at $61.29 per barrel, up 0.38% on the day.
Spot gold fell 2.19% to $4,230.60 an ounce. U.S. gold futures fell 1.3% to $4,224.60 an ounce.
Reporting by Stephen Culp; Additional reporting by Ian Withers and Stella Qiu; Editing by Nia Williams and Nick Zieminski
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