NEW YORK, Aug 14 ― Stocks ticked down from six-month highs yesterday on concern over a stalled US economic relief deal, while oil fell and the euro edged up against the US dollar.
Treasury yields hit multi-week highs after record supply at a 30-year bond auction drew poor demand.
Initial claims for US state unemployment benefits dipped below 1 million last week for the first time since mid-March, but the expiration at the end of July of a US$600 (RM2,514) weekly jobless supplement likely contributed to the decline.
Data showed the world's largest economy regained only 9.3 million of the 22 million jobs lost between February and April. But Wall Street has recovered most equity market losses, and the benchmark S&P 500 was within a few points of a record high.
“Our take on a new high, if it happens, is that it's another reminder to investors how disconnected the stock market and the economy have been this year. Stocks have soared but the economy ― it's improved, yes ― but a million initial claims is still not good,” said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, North Carolina.
The Dow Jones Industrial Average fell 80.12 points, or 0.29 per cent, to 27,896.72, the S&P 500 lost 6.92 points, or 0.20 per cent, to 3,373.43 and the Nasdaq Composite added 30.27 points, or 0.27 per cent, to 11,042.50.
The STOXX 600 suffered its first fall in five days after Washington said it would maintain 15 per cent tariffs on planes and 25 per cent tariffs on other European goods.
The pan-European index lost 0.63 per cent and MSCI's gauge of stocks across the globe shed 0.04 per cent.
The five-month global rally has caused MSCI's world index to rise 50 per cent from its March lows and reach within 2 per cent of an all-time high.
In the currency and bond markets, faltering hopes for a compromise between Republicans and Democrats over additional stimulus for the US economy dragged the dollar index down, though it pared losses late in the session.
The greenback fell 0.139 per cent, with the euro up 0.28 per cent to US$1.1815.
The Japanese yen weakened 0.01 per cent versus the dollar to 106.92 per dollar, while Sterling was last trading at US$1.3068, up 0.28 per cent on the day.
A sell-off in benchmark government bond markets also eased, as investors digested the biggest-ever 10-year US debt sale, and some surprisingly robust US inflation figures.
US Treasury yields rose to multi-week highs after the Treasury auction of a record amount of 30-year bonds.
Benchmark 10-year notes last fell 11/32 in price to yield 0.7208 per cent, from 0.686 per cent late on Wednesday.
The 30-year bond last fell 1-17/32 in price to yield 1.4297 per cent, from 1.365 per cent.
In Asia, Japanese stocks were the main mover, soaring 1.8 per cent to a six-month peak on gains from chip firms.
Japan's Nikkei futures rose 0.04 per cent. Emerging market stocks rose 0.20 per cent.
Oil prices eased after underwhelming data, but the weak dollar limited losses. Traders kept an eye on US stimulus headlines.
“Overall, neither yesterday's Opec or today's IEA release appeared to have much effect on an oil market that is still primarily focused on the ongoing expansion in risk appetite that remains undeterred by lack of progress in formulating a viable US stimulus deal,” said Jim Ritterbusch of Ritterbusch and Associates.
US crude recently fell 0.84 per cent to US$42.31 per barrel and Brent was at US$45.05, down 0.84 per cent on the day.
Spot gold added 1.9 per cent to US$1,953.22 an ounce. Silver gained 7.25 per cent to US$27.41. ― Reuters