Stocks struggle as treasuries drop; pound drifts

Stocks struggle as treasuries drop; pound drifts

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Stocks struggled to hold gains and Treasuries dropped as
investors weighed the political turmoil in Britain and the prospects for policy
makers to arrest a slowdown in global growth.

The pound fluctuated and UK stocks fell before a
no-confidence vote in Prime Minister Theresa May’s government.

Futures on the S&P 500 and Dow Jones edged higher, while
those on the Nasdaq were flat. Declines for consumer-goods companies offset
gains for banks and insurers as the Stoxx Europe 600 Index pared an early
advance.

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The UK’s FTSE 100 gave back most of Tuesday’s gain as
investors contemplated May’s Brexit defeat. The dollar reversed a decline and
oil retreated below $52 a barrel in New York.

“Markets will be choppy in coming days but it’s worth
remembering that nothing fundamental has changed overnight,” said
Stephanie Kelly, an economist at Aberdeen Standard. “The wisest thing for
investors to do in the short term is nothing.”

The mood in markets remains fairly buoyant after China
pledged to step up efforts to support growth and European Central Bank President
Mario Draghi said the euro area will avoid a recession even though recent data
signaled softening momentum.

READ: British pound rallies on May’s Brexit setback, stocks
gain

Still, there are plenty of worries to give investors pause
before taking this month’s rally in equities further.

The political impasse in Washington continues to leave
swathes of the federal US government shuttered, and the UK’s Brexit drama
threatens to impair business confidence in the second-largest European economy.

Here are some important events coming up:

A confidence motion vote will take place after 19:00 in
London as the opposition Labour Party tries to force a general election.

Some of the world’s biggest banks announce earnings,
including Bank of America, Morgan Stanley and Goldman Sachs. Alcoa, Indian IT
company Mindtree, Netflix, Taiwan Semiconductor and BlackRock also post
results.

These are the main moves in markets:

Stocks

The Stoxx Europe 600 Index climbed 0.1% as of 06:24 New York
time. Futures on the S&P 500 Index increased 0.1% to the highest in almost
five weeks.

The MSCI All-Country World Index declined 0.1%. The UK’s
FTSE 100 Index sank 0.6% to the lowest in more than a week. The MSCI Emerging
Market Index rose 0.1% to the highest in six weeks.

Currencies

The Bloomberg Dollar Spot Index increased 0.1% to the
highest in more than a week. The euro dipped 0.2% to $1.1395, hitting the
weakest in almost two weeks with its fifth consecutive decline.

The British pound was unchanged at $1.2861. The Japanese yen
fell 0.1% to 108.80 per dollar.

Bonds

The yield on 10-year Treasuries climbed three basis points
to 2.74%. Germany’s 10-year yield climbed three basis points to 0.23%, the
first advance in a week.

Britain’s 10-year yield rose seven basis points to 1.329%,
the highest in almost seven weeks on the largest rise in more than a week.
Japan’s 10-year yield declined less than one basis point to 0.01%.

Commodities

West Texas Intermediate crude fell 0.5% to $51.86 a barrel.
Gold declined less than 0.05% to $1 289.16 an ounce.

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