Stock indexes inch higher, bond yields relax

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U.S. flags fly in front of the New York Stock Exchange on Oct. 8, 2014. (Mark Lennihan / AP)

U.S. stock indexes nudged closer to record territory Friday morning, led by companies that pay big dividends. Bond yields gave up some of their big gains from the last few days.

The Standard & Poor’s 500 index rose 2 points, or 0.1%, to 2,264 as of 7 a.m. Pacific time. The Dow Jones industrial average rose 33 points, or 0.2%, to 19,885. The Nasdaq composite rose 7 points, or 0.1%, to 5,464, above the current record closing level.

The yield on the 10-year Treasury fell to 2.58% from 2.60% late Thursday, putting at least a temporary halt to its strong rally since last month’s presidential election.

Bond yields had been jumping since Donald Trump’s surprise victory on expectations that faster economic growth and inflation may be on the way. The 10-year Treasury yield was at 1.86% on election day.

Yields kept rising this week after the Federal Reserve raised interest rates for only the second time in a decade and said that three more increases may be on the way in 2017.

The two-year Treasury yield fell to 1.26% Friday from 1.28% late Thursday, pulling back from its highest level since the summer of 2009.

The dip in bond yields helped to halt the weeks-long slide for high-dividend stocks, at least temporarily. Utilities, real-estate stocks and telecoms have struggled on worries that higher yields will cause income investors to abandon them in favor of bonds.

Real estate stocks jumped 1.6%, more than double the gain of any of the other 10 sectors that make up the S&P 500. Utility stocks rose 0.7%, and telecoms rose 0.3%.

Jabil Circuit rose $2.73, or 12.7%, to $24.30 after reporting stronger earnings than analysts expected for its latest quarter .

In Europe, Germany’s DAX rose 0.3%, France’s CAC 40 rose 0.4% and Britain’s FTSE 100 rose 0.3%. In Asia, Japan’s Nikkei 225 gained 0.7%, South Korea’s Kospi rose 0.3% and Hong Kong’s Hang Seng fell 0.2%.

Crude oil rose 63 cents, or 1.2%, to $51.53 per barrel in New York. Brent crude, the international standard, rose 80 cents to $54.80 a barrel in London.

Gold recovered a bit after falling to its lowest price in 10 months on Thursday. It rose $4.10, or 0.4%, to $1,133.90 per ounce. Silver rose 0.6%, and copper fell 0.7%.

The euro held steady at $1.0424, a day after the dollar reached its highest level against the shared currency since early 2003. The dollar rose to 118.18 Japanese yen from 117.93 late Thursday.

UPDATES:

7:30 a.m.: This article was updated with more recent market information.

This article was originally published at 6:55 a.m.