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GLOBAL MARKETS-Big tech weighs on U.S., world equities, capping gains on Trump's improving health

Published 07/10/2020, 02:05 am
Updated 07/10/2020, 02:06 am
© Reuters.
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* Big tech caps index gains on antitrust threat

* Fed Chair Powell speaks

* Crude extends gains on Trump's recovery, supply pressures

* Stimulus talks ongoing

* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn

* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh (Updates to U.S. markets open, changes dateline from LONDON to NEW YORK, changes byline)

By Stephen Culp

NEW YORK, Oct 6 (Reuters) - Large-cap tech stocks weighed on U.S. and European equities on Tuesday despite reassurances about President Donald Trump's improving health and progress toward a stimulus deal.

President Trump said he felt "real good" upon returning to the White House after a three-day hospital stay where he received an experimental treatment for COVID-19. view that Trump appears to be on the road of recovery is benefiting the global markets because it indicates that there is stability in the White House," said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.

But market-leading large cap tech stocks weighed on U.S. stocks after reports that the U.S. House of Representative's upcoming antitrust report contains a "thinly veiled call" to break up the companies. Federal Reserve Chair Jerome Powell is speaking on the topic of "Economics, Business and Policy in the Pandemic" at a virtual meeting of the National Association for Business and Economics.

"Powell's not prone to surprising the markets," Ghriskey added. "He's likely to confirm the Fed's goals of improving employment and creating some inflation over the longer term."

Stocks were little changed as Powell began his remarks.

Optimism over the passage of a new pandemic relief aid package was simmering in the background, as U.S. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin continued to hammer out a bipartisan agreement months after emergency benefits expired for millions of Americans. Dow Jones Industrial Average .DJI rose 107.79 points, or 0.38%, to 28,256.43, the S&P 500 .SPX gained 3.18 points, or 0.09%, to 3,411.81 and the Nasdaq Composite .IXIC dropped 2.36 points, or 0.02%, to 11,330.12.

European equities advanced after Trump's release from the hospital helped ease uncertainties and as Germany reported a "remarkable" jump in industrial orders, but pared gains due to weakness in tech and healthcare stocks . pan-European STOXX 600 index .STOXX rose 0.16% and MSCI's gauge of stocks across the globe .MIWD00000PUS gained 0.28%.

Crude prices extended gains, boosted by waning uncertainties surrounding Trump's health and supply disruptions from the ongoing oil worker strike in Norway. crude CLcv1 rose 3.9% to $40.75 per barrel and Brent LCOcv1 was last at $42.78, up 3.61% on the day.

The dollar edged nominally lower as investors waited for developments in ongoing stimulus talks in Washington. dollar index .DXY fell 0.09%, with the euro EUR= up 0.08% to $1.179.

The Japanese yen strengthened 0.11% versus the greenback at 105.64 per dollar, while Sterling GBP= was last trading at $1.2971, down 0.05% on the day.

U.S. Treasury yields slightly extended their rise after Fed Chair Powell began speaking on the economy.

Benchmark 10-year notes US10YT=RR last fell 7/32 in price to yield 0.7834%, from 0.762% late on Monday.

The 30-year bond US30YT=RR last fell 27/32 in price to yield 1.6029%, from 1.567% late on Monday.

Stimulus hopes also helped gold prices inch higher. gold XAU= added 0.2% to $1,916.49 an ounce.

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