NEW YORK: Global stocks were mixed Monday (23rd of Oct, 2023) as markets monitored US Treasury yields and ongoing conflict in the Middle East, while awaiting key earnings and economic data later in the week.
US indices opened the day firmly lower after the yield on the 10-year US Treasury note topped five percent for the first time in 16 years.
But as yields moved lower later in the day, large technology companies gave markets a boost, with Google parent Alphabet, Amazon and Microsoft shares all rising ahead of earnings due later in the week.
That lifted the Nasdaq into positive territory at session’s end, even as the Dow and S&P 500 both retreated.
“The trajectory of US Treasuries is not merely a question; it is the only question for financial markets,” said Stephen Innes, managing partner at SPI Asset Management, in a note to clients.
“US government bonds are the critical benchmark reference point against which virtually all other global assets are ultimately priced off,” he added.
The rise in bond yields has worsened worries that Federal Reserve interest rates will stay higher for longer, denting the growth outlook.
Besides a heavy week of earnings, this week’s schedule includes several significant economic reports that will be scrutinized for their implications on monetary policy.
These include a report on third quarter US growth and September personal income and spending that also includes key inflation data.
Markets are also keeping an eye on rising carnage in the Middle East where Israel has launched a bombing campaign following the October 7 Hamas attack on the country.
While the fear remains that other countries including Iran could be drawn into a regional conflagration, Israel holding off on a ground attack has provided a shaft of light for the crude market.
Both major oil futures contracts lost more than two percent.
Oil is “taking a breather while the focus on humanitarian aid and securing hostage releases suggest that a potential ground invasion from Israel can wait,” Yeap Jun Rong at IG Asia said.
“That may contain the risks of further escalation, at least for now.”
Elsewhere, there was little movement on Europe’s bourses, with London finishing just off while Paris and Frankfurt nudged into the green.
Among individual companies, Hess shares fell 1.1 percent after announcing it agreed to be acquired by rival oil company Chevron for $53 million in an all-stock deal.
Chevron shares dropped 3.7 percent.
The deal comes on the heels of ExxonMobil’s announcement earlier this month that it will buy Texas shale producer Natural Resources for about $60 billion.
– Key figures around 2030 GMT –
New York – Dow: down 0.6 percent at 32,936.41 (close)
New York – S&P 500: DOWN 0.2 percent at 4,217.04 (close)
New York – Nasdaq: UP 0.3 percent at 13,018.33 (close)
London – FTSE 100: DOWN 0.4 percent at 7,374.83 points (close)
Frankfurt – DAX: FLAT at 14,800.72 (close)
Paris – CAC 40: UP 0.5 percent at 6,850.47 (close)
EURO STOXX 50: UP 0.4 percent at 4,041.75 (close)
Tokyo – Nikkei 225: DOWN 0.8 percent at 30,999.55 (close)
Shanghai – Composite: DOWN 1.5 percent at 2,939.29 (close)
Hong Kong – Hang Seng Index: Closed for holiday
Dollar/yen: DOWN at 149.67 yen from 149.86 yen on Friday
Euro/dollar: UP at $1.0670 from $1.0594
Pound/dollar: UP at $1.2248 from $1.2164
Euro/pound: DOWN at 87.09 pence from 87.71 pence
West Texas Intermediate: DOWN 2.9 percent at $85.49 per barrel
Brent North Sea crude: DOWN 2.5 percent at $89.93 per barrel