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S&P, Nasdaq Hit Records Amid China, Deals Optimism: Markets Wrap

Pedestrians stand in front of monitors displaying the U.S. Dollar (USD) and Euro (EUR) exchange rate outside Morgan Stanley & Co. headquarters in the Times Square neighborhood of New York, U.S., on Monday, April 8, 2019. U.S. stocks pared losses as investors awaited signs of progress in the trade war with China ahead of the latest corporate earnings season. Photographer: Michael Nagle/Bloomberg via Getty Images

U.S. equities climbed to records on optimism over China trade relations and a fresh wave of merger and acquisition activity. The dollar strengthened.

The S&P 500 and Nasdaq Composite Indexes touched all-time highs after China said over the weekend that it will tighten intellectual property rules, a move aimed at boosting the chances of a trade deal between the two largest economies. Charles Schwab Corp. agreed to buy TD Ameritrade Holding Corp., while LVMH purchased U.S. jeweler Tiffany & Co.

“The market’s momentum is compelling more M&A activity,” said David Sowerby, managing director at Ancora Advisors. “That’s a validation of the momentum being favorable, that companies are doing deals and acquisitions.”

The Stoxx Europe 600 Index advanced, with all 19 industry sectors closing in the green. Equities climbed across Asia, led by those in Hong Kong, where local elections brought a landslide victory to pro-democracy candidates. The dollar gained versus the euro and yen.

Volatility short positions hit record as fear gauge falls silent

While doubts about the rally remain and haven investments such as bonds seem well-supported, stocks globally are approaching a third month of gains. The S&P 500 Index is building on an advance from Friday, when President Donald Trump said he was “very close” to a trade pact with Chinese President Xi Jinping, even as Treasuries hold on to most of their two-week surge.

“Markets are relatively optimistic about a phase one trade deal happening, but obviously there’s more uncertainty until President Trump and President Xi sit down and sign something more formal,” said Yung-Yu Ma, chief investment strategist at BMO Wealth Management.

Elsewhere, China was planning a record sale of sovereign bonds in dollars, with a potential $6 billion offering, according to people familiar with the discussions. West Texas-grade oil futures drifted. Bitcoin dropped as much as 11% before paring the decline.

Here are some key events coming up this week:

  • Federal Reserve Chairman Jerome Powell speaks on Monday at the Greater Providence Chamber of Commerce annual dinner in Providence, Rhode Island.
  • Alibaba starts trading in Hong Kong on Tuesday.
  • Reserve Bank of Australia Governor Philip Lowe will give a speech on unconventional monetary policy on Tuesday evening in Sydney.
  • U.S. consumer spending data is due Wednesday, along with GDP, jobless claims and durable goods.
  • The U.S. celebrates Thanksgiving on Thursday, when equity and bond markets will be shut.
  • The Bank of Korea sets policy on Friday.

These are the main moves in markets:


  • The S&P 500 Index advanced 0.6% to 3,129.78 as of 2:26 p.m. New York time, the highest on record with the largest gain in more than a week.
  • The Dow Jones Industrial Average advanced 0.5% to 28,018.03, the highest in a week on the biggest gain in more than a week.
  • The Nasdaq Composite Index surged 1.2% to 8,624.50, the highest on record with the largest jump in almost six weeks.
  • The MSCI All-Country World Index advanced 0.6% to 546.84, the highest in 22 months on the biggest gain in more than a week.


  • The Bloomberg Dollar Spot Index gained 0.1% to 1,207.69, hitting the highest in six weeks with its fifth straight advance.
  • The euro fell 0.1% to $1.1008, the weakest in more than a week.
  • The Japanese yen depreciated 0.3% to 108.96 per dollar, the weakest in almost two weeks on the largest fall in more than a week.
  • The British pound jumped 0.5% to $1.2901, the first advance in a week and the biggest increase in two weeks.


  • The yield on two-year Treasuries fell one basis point to 1.62%.
  • The yield on 10-year Treasuries declined one basis point to 1.77%.
  • Germany’s 10-year yield increased one basis point to -0.35%.
  • Britain’s 10-year yield decreased one basis point to 0.696%, the lowest in more than three weeks.


  • Gold depreciated 0.4% to $1,455.46 an ounce, the weakest in more than 16 weeks.
  • West Texas Intermediate crude climbed 0.5% to $58.05 a barrel.
  • Copper gained 0.1% to $2.66 a pound.

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