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S&P 500, Dow as rising Treasury yields boost banks

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The S&P 500 plus the Dow Jones industrial average rose on Wednesday, while using the Dow hitting its highest closing level since late January as rising Treasury yields boosted the financial sector and trade worries subsided.

The tech-heavy Nasdaq ended the session slightly lower.

Financial companies rose 1.8%, the biggest percentage gainer one of many major S&P 500 sectors, because benchmark 10-year Treasury yield hit a four-month high. Goldman Sachs, JPMorgan Chase, Citigroup and Bank of America ended the session up between 2.6 a few.3%.

“The sharp increase in the 10-year that you’ve welcomed in the last few days and the widening of the yield curve, that’s really built the fireplace under these financials,” said Bucky Hellwig, senior second in command at BB&T Wealth Management in Birmingham, Alabama. “The high rates have obtained the opposite impact on rate of interest sensitive stocks like utilities.”

The Dow Jones Industrial Average rose 158.8 points, or 0.61%, to 26 405.76, the S&P 500 gained 3.64 points, or 0.13%, to 2 907.95 and also the Nasdaq Composite dropped 6.07 points, or 0.08%, to 7 950.04.

Of the 11 major sectors in the S&P 500, seven resulted in negative territory.

So-called defensive stocks lost ground as rising yields provided investors by having an attractive substitute for higher-risk equities. The utilities sector was the best loser, falling 2.1%.

The technology sector edged 0.1% lower, pulled down by a 1.3% decline in Microsoft. The firm raised its quarterly dividend by about 10%, but Morgan Stanley said the hike was beneath the company’s 12-month trailing operating income growth.

Amazon slid 0.8% as European Union regulators searched into if thez largest online retailer was using merchant data to stifle competition.

Among the opposite elements of the FAANG pair of stocks, Netflix have also been down slightly. Facebook rose 1.7%, while Apple and Google parent Alphabet Inc had nominal gains.

In the hottest round of tit-for-tat exchanges from the trade dispute relating to the Us and China, Premier Li Keqiang dismissed talk that Beijing is deliberately weakening its currency to bolster exports.

But trade worries got easing. “The direct impact within the latest round of tariffs for the economy may just be minimal,” wrote Bank of America Merrill Lynch in a very research report.

“There might be some tariff fatigue,” Hellwig said. “Worries ingredient that investors had early in this negotiation process has recently waned a bit more.”

“China is running out of bullets,” he added.

Declining issues outnumbered advancing ones around the NYSE by way of a 1.17-to-1 ratio; on Nasdaq, single.17-to-1 ratio favored decliners.

The S&P 500 posted 32 new 52-week highs with no new lows; the Nasdaq Composite recorded 53 new highs and 58 new lows.

Volume on US exchanges was 6.52 billion shares, as compared to the 6.23 billion average over the past 20 trading days.?

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