Stocks gain with bond yields, dollar up; economy, rates in focus By Reuters

Written by Sinead Caro and Amanda Cooper

NEW YORK/LONDON (Reuters) – Global stock indexes rose on Monday, helped by Wall Street heavyweights and U.S. Treasury yields rose as data showed a deterioration in U.S. consumer confidence and investors prepared for smaller interest rate cuts in 2025.

In US stocks, the NASDAQ and NASDAQ index received support mostly due to rises in large-cap stocks such as Nvidia company (NASDAQ:) and Broadcom (NASDAQ:) Inc.

Earlier, the Conference Board said the US Consumer Confidence Index weakened in December to 104.7 versus economists’ expectations for an increase to 113.3 and November’s upward revision to 112.8 due to concerns about future business conditions.

While new orders for major capital goods manufactured in the United States rose in November amid strong demand for machinery, orders for durable goods – from toasters to aircraft – fell 1.1% after a 0.8% increase in October, and the decline mostly reflects weak commercial aircraft orders. .

Pointing to weak consumer confidence as a major negative for stocks on Monday, Robert Phipps, a director at Per Stirling Capital Management in Austin, Texas, highlighted the s jump to its highest level since late May.

“It is important for equity investors that the 4.6% level for 10-year Treasury yields remains stable, and if we break above it, there is a risk that the market will go ahead and test 5%,” he said, noting a slowdown in Fed rate cuts as the economy slows. a reason.

“The market is adjusting to a less dovish Fed policy,” Phipps said, noting that US indices appeared weaker under the hood on Monday. “It’s a deceptively strong market because if you took out about 10 huge stocks that are winning, the market would go down sharply.”

At 02:52 p.m., the index fell 46.08 points, or 0.11%, to 42,794.18 points, the S&P 500 index increased 25.44 points, or 0.43%, to 5,956.29 points, and rose 147.08 points, or 0.75%, to 19,719.67 points.

MSCI’s index of worldwide stocks rose 3.87 points, or 0.46%, to 848.10 while earlier, the European index closed 0.14% higher.

Ahead of the shorter trading day on Tuesday and the market close on Wednesday for Christmas, Tim Greskey, chief portfolio strategist at Ingalls & Snyder, said investors were still considering the sharp sell-off last Wednesday after the Fed clearly signaled smaller rate cuts. interest next year.

“There is concern about the economy,” Greskey said, referring to US President-elect Donald Trump’s inauguration on January 20. “There is concern about the Fed making a wrong move, and there is an unknown about what Trump will actually do.”

In US Treasuries, yields rose ahead of the sale of two-year Treasuries on Monday but were little changed after the auction.

The yield on US 10-year bonds rose 7.3 basis points to 4.597%, from 4.524% late Friday, while the yield on 30-year bonds rose 6.7 basis points to 4.7832%.

The yield, which typically moves in line with the Federal Reserve’s interest rate expectations, rose 3.5 basis points to 4.347%, from 4.312% late Friday.

In currencies, the dollar advanced after its decline in the previous session, while the euro fell, as the recent meetings of global central banks set expectations for mixed paths to cut interest rates in 2025.

The US currency index, which measures the greenback against a basket of major currencies, rose 0.25% to 108.06.

The euro fell 0.2 percent to $1.0408, while the dollar rose against the Japanese yen 0.44 percent to 157.1 yen.

The British pound fell 0.31% to $1.253, and the Mexican peso fell 0.66% against the dollar at 20.221.

Oil prices fell in thin trading ahead of the Christmas holiday due to concerns about excess supply next year and the rise of the dollar. [O/R]

Futures settled 0.32%, or 22 cents, lower at $69.24 a barrel, falling to $72.63 a barrel, down 0.43%, or 31 cents, on the day.

Gold prices fell in weak holiday trading, affected by the strength of the dollar and rising US Treasury yields.

Gold futures fell 0.42% to $2,609.73 per ounce. US contracts fell by 0.67% to $2,611.10 an ounce.