Major stock markets held near record highs yesterday on signs of an improving global economy and continued central bank support, while the dollar and bond yields rose on an upbeat report on US employment.
The Dow Jones Industrial average and the S&P 500 index closed at record highs on Tuesday, and the Dow flirted with the 17,000 milestone for a second day.
Evidence of faster economic growth also supported gold prices, though they were below a three-month peak set on Tuesday.
Oil prices in London fell to their lowest in nearly three weeks on a possible substantial recovery in Libyan exports after rebels said they would reopen two oil terminals.
“Equity investors are anticipating growth,” said Jack Ablin, chief investment officer at BMO Private Bank in Chicago.
“The economic background is improving. That’s why you are seeing bonds sell off.”
The latest evidence the US economy has recovered from its first-quarter contraction was 281,000 new jobs in the US private sector last month, according to payroll processor ADP. That was the strongest monthly gain in 1½ years.
While the world’s biggest economy has regained steady footing, the US Federal Reserve has shown no hints it will raise interest rates from near zero until the second half of 2015 at the earliest.
Investors will look for clues from Fed Chair Janet Yellen, who spoke about financial stability yesterday.
They also awaited a meeting of the European Central Bank today to provide more guidance after data showed eurozone industrial prices fell for a fifth consecutive month in May.
In early US trading, the Dow Jones industrial average rose 11.21 points, or 0.07 per cent, at 16,967.28.
The Standard & Poor’s 500 Index was up 1.94 points, or 0.10 per cent, at 1,975.26. The Nasdaq Composite Index was up 5.67 points, or 0.13 per cent, at 4,464.32
The pan-European FTSEurofirst 300 equity index was up 0.3 percent at 1,385.93. Tokyo’s Nikkei closed up 0.3 per cent.
The MSCI world equity index rose 0.2 per cent to 432.25.
The yield on benchmark US 10-year Treasuries notes rose to the highest in a week at 2.61 per cent.
In currency trading, the dollar index, which tracks the greenback versus a basket of six currencies, rose 0.18 per cent to 79.962.
Among commodities, spot gold prices rose $3.96 to $1,329.40 an ounce.
Brent crude was last down 35 cents, or 0.3 per cent, at $111.94 a barrel. US crude was last down three cents, or 0.03 per cent, at $105.31 per barrel.