Wall Street rises as bond sales pause, crude rises By Reuters


©Reuters. File image of traders working in front of a chart of the German DAX stock market index at the stock exchange in Frankfurt, Germany. January 15, 2015. REUTERS/Kai Pfaffenbach/File

By Herbert Lash and Huw Jones

NEW YORK/LONDON, Jan 20 (Reuters) – Bond yields pulled back from their strong week-long rise on Thursday and Wall Street rebounded as Big Tech investors licked their wounds after the price fell into correction territory.

* However, fears that the Federal Reserve will be more aggressive in raising interest rates this year than the market expects continued to weigh on sentiment as investors await the central bank’s policy meeting next week. week in search of new directions.

* Prices fell initially, but then rose to hit seven-year highs, while the dollar weakened as nearly all of the rise in US Treasury yields this week stalled.

* Strong earnings reports helped prop up all 11 sectors in a day of broad gains, while major European stock indices also rose. MSCI’s measure of global shares was up 1.14%.

* The broad pan-European index closed 0.41% better, while Wall Street’s main indices all climbed above 1.1%.

* Investors are concerned about higher rates as they raise the cost of borrowing and could dampen global growth prospects and weigh on companies’ earnings outlook.

* Two-year bond yields, which typically move in line with rate expectations, rose 1.8 basis points to 1.043%, and benchmark 10-year notes gained 1.1 basis points to 1.838. %, below the two-year high of 1.902% that hit the day before.

* The key catalyst for markets so far this year has been expectations of rate hikes as the Fed tightens monetary policy, said Kevin Flanagan of WisdomTree Investments Inc.

* “Given the amount of pressure we saw earlier in the week, the market is just consolidating a bit. Rates don’t always move in the same direction every day,” he noted.

* Asian stocks snapped a five-day losing streak on Thursday, as China underscored its divergent monetary and economic outlook by cutting benchmark mortgage rates.

* China’s benchmark CSI300 index rose 0.9%, led by property developers, amid hopes the government’s moves would ease a funding crunch in the beleaguered sector, even as another developer warned of a default.

* The , which compares the greenback to a basket of six leading currencies, fell 0.081% to 95.519 units. The Japanese currency was down 0.28% at 114 yen, and the euro was down 0.03% at $1.1338.

* In commodities, crude oil prices rebounded and gained around 0.4%, while the y touched a two-month high, fueled by inflation and tensions between Russia and Ukraine. Spot gold was up 0.3% at $1,845.58 an ounce, its highest level since Nov. 22.

CHART: US tech stocks and bonds https://tmsnrt.rs/3nIZ9W5

Exchange rates in the world http://tmsnrt.rs/2hzquG7

Asset performance in the year http://tmsnrt.rs/2szi3CI

Wall Street deepens fall and Nasdaq reaffirms a correction

China cuts interest rates in its effort to prop up the economy

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(Additional reporting by Andrew Galbraith; Spanish editing by Carlos Serrano)

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