Treasuries Fall, Stocks Mixed as Commodities Gain: Markets Wrap

(Bloomberg) -- Markets struggled for direction Tuesday, with U.S. stocks ending an up-and-down session little changed and the dollar rising with Treasury yields. Crude oil rose to a four-week high.

Energy and materials producers led advances in the S&P 500 Index, offsetting declines in financial stocks as economic data did little to alter views on the strength of the economy. Treasury 10-year notes fell, sending the yield to 2.35 percent, while the dollar advanced versus all major peers except the yen. Crude topped $51 a barrel in New York. Selling in South Africa's rand abated after six days of losses.

Investors are taking stock ahead of a key U.S. jobs report and minutes from the Federal Reserve's latest meeting on Wednesday. After a strong start to the year for American equities, traders are starting to question whether optimism about U.S. President Donald Trump's pro-growth policies has gone too far. Veteran money manager Bob Doll wrote in an April 3 letter to clients that sentiment on the economy may be too high, leaving investors vulnerable to negative surprises.

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What investors will be watching this week:

• Fed speakers include William Dudley, president of the New York Fed, and Governor Daniel Tarullo. Minutes from the March meeting, which are scheduled to be released April 5, should put their recent public comments into perspective. Minutes are also due from the European Central Bank's latest gathering.
• France's presidential candidates assemble for another TV debate Tuesday.
• China's President Xi Jinping will meet U.S. President Donald Trump for two days starting April 6.
• U.S. non-farm payrolls are due April 7.

Here are the main moves in markets:

Stocks

• The S&P 500 Index rose 0.1 percent to 2,360.05 at 4 pm. in New York, while the Dow Jones Industrial Average advanced 0.2 percent. Small caps fell 0.1 percent.
• Energy producers in the S&P 500 rose 0.7 percent. Banks led declines with a 0.2 percent slide.
• The Stoxx Europe 600 Index added 0.2 percent, while emerging market equities dropped 0.1 percent.

Currencies

• The yen rose 0.1 percent to 110.742 per dollar, after climbing at least 0.4 percent in each of the previous two sessions. 
• The Bloomberg Dollar Spot Index added 0.2 percent.
• The South African rand rose 0.5 percent against the dollar, ending a six-day slide. Moody's Investors Service postponed a review of the country's credit rating after S&P Global cut its rating to junk amid a cabinet purge by President Jacob Zuma.  

Bonds

• The yield on 10-year Treasury notes rose four basis points to 2.36 percent.
• The yield spread between five- and 30-year Treasuries widened to about 110 basis points.
• Yields on South African benchmark dollar bonds climbed three basis points to 5.13 percent after rising seven points on Monday.

Commodities

• Oil climbed 1.6 percent to settle at $51.03 per barrel, the highest close since March 7. 
• U.S. crude inventories were forecast to drop and there were reports of a North Sea oil-field shutdown.
• Gold futures rose 0.3 percent to $1,258.10 an ounce, heading for the highest close since Nov. 10. Silver reached highest in a month.

--With assistance from Sid Verma and Mark Shenk

To contact the reporter on this story: Eddie van der Walt in London at evanderwalt@bloomberg.net.

To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Natasha Doff