(Bloomberg) — U.S. stocks traded mixed, with gains in tech shares blunting weakness in airlines and hotels amid signs that the world economy has a long way to go to get back on track.
Two stocks fell on the S&P 500 Index for every one that gained, though the gauge was just slightly lower as heavyweights such as Microsoft Corp., Apple Inc. and Facebook Inc. rose, sending the Nasdaq Composite to a record. Companies dependent on an end to virus lockdowns underperformed and the Dow Jones Industrial Average slumped. European shares fell on concern the economy will take longer to recover.
Gold climbed to the highest since 2011. The dollar strengthened and Treasury yields held steady. Brazil’s currency erased gains as President Jair Bolsonaro said he had tested positive for Covid-19.
Investors are catching their breath after a ferocious rally that fueled the S&P 500’s best winning streak this year. While recent reports show the global economy could be past the worst of the slump, it’s a long road back to pre-crisis levels. Federal Reserve Bank of Atlanta President Raphael Bostic said in an interview with the Financial Times that economic activity in parts of the the U.S. is showing signs of leveling off amid a resurgence in coronavirus cases.
“Yesterday was a really strong day, so I’m not surprised to see a bit of profit-taking,” said Bob Phillips, managing principal at Spectrum Management Group. “We’re kind of in a range-bound market.”
The European Commission gave its starkest warning yet about the impact of the pandemic. Officials now forecast a contraction of 8.7% in the euro area this year, a full percentage point deeper than previously predicted.
German Industry Rebounds From Virus Nadir Facing Long Road Ahead
Elsewhere, most Asian shares dropped, even as Chinese stocks powered ahead for a sixth day, although at a slower pace. The offshore yuan briefly strengthened through the 7 per dollar level for the first time since March.
Here are some key events coming up:
The EIA crude oil inventory report comes Wednesday.All eyes will be on the U.S. weekly jobless claims report on Thursday.Singapore holds its general election on Friday.
These are the main moves in markets:
Stocks
The S&P 500 Index fell 0.2% as of 1 p.m. New York time.The Stoxx Europe 600 Index sank 0.6%.The MSCI Asia Pacific Index declined 0.6%.The MSCI Emerging Market Index decreased 0.8%.
Currencies
The Bloomberg Dollar Spot Index gained 0.2%.The euro decreased 0.2% to $1.129.The British pound rose 0.5% to $1.256.The Japanese yen weakened 0.2% to 107.52 per dollar.
Bonds
The yield on 10-year Treasuries dipped two basis points to 0.66%.Germany’s 10-year yield was little changed at -0.43%.Britain’s 10-year yield sank two basis points to 0.18%.
Commodities
West Texas Intermediate rose 0.3% to $40.75 a barrel.Gold rose 0.6% to $1,795.50 an ounce.
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