US stocks end mostly lower

Investors grappled with rising bond yields and a mixed bag of earnings reports

U.S. stocks ended the session little changed on Monday, 23 APril 2018 as investors grappled with rising bond yields and a mixed bag of earnings reports. The stock market wobbled on Monday as investors braced for a busy week of corporate earnings and kept a close eye on Treasury yields, which rose to multi-year highs. The Nasdaq Composite and the Dow Jones Industrial Average each finished a step lower, notching their third and fourth straight losses, respectively, while the S&P 500 eked out a slim win, closing just a tick above its flat line.

The Dow Jones Industrial Average ended 14.25 points, or less than 0.1%, lower at 24,448.69, closing with losses for a fourth straight session. The Nasdaq Composite Index shed 17.52 points, or 0.3%, to 7,128.60. The S&P 500 index closed virtually unchanged at 2,670.29, with six of its 11 main sectors finishing in positive territory.

In corporate news, Dow components Caterpillar, Merck, Exxon Mobil and Verizon all rose after receiving ratings upgrades, Kimberly-Clark slid after revealing that its first quarter margins were significantly impacted by commodity inflation, and Hasbro ended higher despite initially dropping as much as 4.6% after reporting worse-than-expected profits and sales for the first quarter.

The ICE U.S. Dollar Index was up 0.6% at 90.72. Its gain lowers the appeal of dollar-priced commodities, to investors using other currencies.

Bond yields, which are reflecting a rise in inflation expectations, were on the march higher Monday, a continuation of gains logged last week. The 10-year Treasury note yield hovered around 2.984% on Monday, after jumping to 2.956% on Friday, for the highest level since January 2014.

U.S. economic data on Monday was upbeat. The Chicago Fed's index of national economic activity was a positive 0.10 last month, down from the upwardly revised positive 0.98 in February. The flash IHS Markit U.S. manufacturing PMI climbed to 56.5 this month from 55.5 and touched a 3-year high. Existing-home sales, meanwhile, climbed to a 5.60 million seasonally adjusted annual pace in March.

Volume was light once again on Monday, with just 730 million shares changing hands at the New York Stock Exchange (50-day moving average is 897 million).

Bullion prices ended substantially lower at Comex on Monday, 23 April 2018. Gold futures on Monday settled lower for a third session in a row, touching the lowest level in nearly five weeks, as the commodity has been buffeted by a strengthening dollar and gains in the benchmark Treasury note.

June gold was down $14.30, or 1.1%, to $1,324 an ounce, marking its lowest finish since March 21 and its worst daily drop since 12 April. The three-session skid is the lengthiest since a similar downturn ended 16 March. The yellow metal hit a 2 -month high of $1,360. Last week, gold futures fell by roughly 0.7%, the first such loss in three weeks.

May silver tumbled 57.6 cents, or 3.4%, to $16.587 an ounce on Monday, pulling back from its own 2 -month high hit last week. The decline represented the sharpest daily fall since 3 July, 2017 and its longest losing trend since mid March. The contract saw a 3% gain for last week.

Oil prices gave up earlier declines to settle higher on Monday, 23 April 2018, as reports that a Saudi-led air strike killed the head of the Houthi rebels in Yemen raised the potential for disruptions to the flow of crude in the Middle East.

U.S. benchmark oil prices had turned higher around the last hour of trading on the New York Mercantile Exchange. Earlier losses were fed by strength in the U.S. dollar and news of a higher U.S. rig count late last week, which pointed to further growth in domestic crude production.

June West Texas Intermediate crude rose 24 cents, or nearly 0.4%, to settle at $68.64 a barrel on Nymex, after trading as low as $67.14. The expired May contract logged a 1.5% gain last week. June Brent crude on Monday tacked on 65 cents, or 0.9%, to $74.71 a barrel on ICE Futures Europe, reversing course after touching a low of $73.13.

Looking ahead to Tuesday's data, investors will receive the FHFA Housing Price Index for February (consensus +0.5%), the S&P Case-Shiller Home Price Index for February (consensus +6.4%), New Home Sales for March (consensus 631K), and the Conference Board's Consumer Confidence Index for April (consensus 126.1).

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