Markets Right Now: Stocks are mostly lower; bond yields rise

Global stock markets mixed amid trade uncertainty

Treasuries were a key factor for the market Tuesday as investors watched 10-year Treasury yields climb to 3.08%. In other words, you can earn higher income on risk-free short-term money than you can on stocks.

The prospect of higher interest rates weighed on homebuilders, while the pickup in bond yields sent shares in high-dividend paying stocks lower.

THE QUOTE: "We're of the view that we're not in a high-rate environment, we're in a less-low rate environment", said Erik Davidson, chief investment officer at Wells Fargo Private Bank.

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The S&P 500 index fell 18 points, or 0.7 percent, to 2,712.

The Dow Jones industrial average gained 68 points, or 0.3 percent, to 24,899. The Nasdaq Composite Index was down 59.69 points, or 0.81 percent, to 7,351.63.

The S&P 500 rose 2 points, or 0.1 percent, to 2,730.

THE QUOTE: "There's a number of data releases that will grab traders' attention today and could determine whether we see an early rebound in stock markets". That's the highest level since July 2011 for the yield, which is used to set interest rates on mortgages and other kinds of loans.

On the economic front, advance estimates of U.S. retail and food services sales for April were 497.6 billion U.S. dollars, an increase of 0.3 percent from the previous month, in line with market expectations, said U.S. Commerce Department on Tuesday.

The market now prices a near 40% chance of an additional third hike this year by the Fed and sees the Fed funds rate above 2.75% at the end of 2019. Germany's DAX fell 0.1 percent after new data showed the country's economy slowed in the first quarter.

"Yields on treasuries with shorter maturities are at their highest closing and intraday points in about a decade, continuing the basis point increases that began in September 2017 and have sustained so far this year", Tradeweb noted. Higher mortgage rates can make it harder for would-be buyers to purchase a home.

The S&P 500 is up 37.84 points, or 1.4 percent.

Viacom slumped 6 percent and CBS rose 4 percent after CBS sued to block efforts to force the company combine with Viacom.

Technology and health care companies took some of the worst losses. Chipmaker Nvidia fell 3.8 percent to $245.56.

ENERGY: Benchmark U.S. crude oil reversed an early side, rising 35 cents to settle at $71.31 a barrel in NY. Brent crude, used to price worldwide oil, added 20 cents to $78.43 in London. Bed Bath & Beyond rose 2.4 percent to $17.48.

The Russell 2000 is up 64.83 points, or 4.2 percent. Gold fell $27.90, or 2.1 percent, to $1,290.30 an ounce. Williams said he thought the "new normal" for the neutral rate was around 2.5% (he added that he didn't expect the fiscal stimulus to have any more than a 0.25% impact on neutral) while Kaplan put it in a range of 2.5-3%. Australia's S&P/ASX 200 lost 0.6 percent. Hong Kong's Hang Seng dropped 1.2 percent.



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