Bonds pare gains on Catalan news, U.S. stocks outpace Europe
NEW YORK - Stocks around the world rose on Tuesday as Wall Street eked out record highs ahead of earnings season, while U.S. Treasury prices pared gains after Catalonia's leader allowed for talks with Madrid as he proclaimed independence from Spain.
Oil futures rose on signs of supply rebalancing, helping shares in energy companies.
The dollar lost ground and the euro climbed to its highest point in a week and firmed further on the Catalan news.
Catalan leader Carles Puigdemont proclaimed the region's independence, but said its effects would be suspended to allow for talks with the Madrid government.
"If you really want to be bearish about this market, there's no shortage of macro events you could point to whether its North Korea or China, Catalonia or the Trump dynamics. So far the market has looked through every one of them," said Nathan Thooft, senior managing director in asset allocation at Manulife Asset Management in Boston.
"It’s this game of looking at macro events versus actual fundamentals, and fundamentals are driving the market," said Thooft who expects earnings to beat expectations.
The three major Wall Street indexes scaled new records, helped by gains in energy stocks and in Wal-Mart on the back of the company's $20 billion share buyback plan.
The Dow Jones Industrial Average rose 45.78 points, or 0.2 percent, to 22,806.85, the S&P 500 gained 3.7 points, or 0.15 percent, to 2,548.43 and the Nasdaq Composite dropped 0.48 points, or 0.01 percent, to 6,579.25.
European bourses ended the day slightly lower on Tuesday as investors braced themselves for a possible unilateral declaration of independence at the Catalan parliament.
The dollar index, which tracks the greenback against a basket of major currencies, fell for the third day in a row. It was down 0.41 percent, with the euro up 0.54 percent to $1.1802.
On top of strong German export data, traders were also upbeat after one of the European Central Bank's German policymakers called for an end to its stimulus.
Benchmark 10-year notes last rose 7/32 in price to yield 2.3445 percent, from 2.368 percent late on Monday.
The 30-year bond last rose 15/32 in price to yield 2.8824 percent, from 2.906 percent late on Monday.
In commodities, Brent oil prices pushed above $56 a barrel after top producer Saudi Arabia signaled it would trim its exports and as OPEC flagged ongoing efforts to try to restore the longer-term "balance" of the market.
U.S. crude rose 2.56 percent to $50.85 per barrel and Brent was last at $56.49, up 1.25 percent on the day.
Gold prices also hit their highest in more than a week against the backdrop of a weaker dollar although expectations for another U.S. interest rate hike capped gains. Spot gold added 0.4 percent to $1,288.80 an ounce. REUTERS