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GLOBAL MARKETS-Stocks retreat as U.S. 10-year yields top 3 percent

Published 25/04/2018, 01:18 am
© Reuters.  GLOBAL MARKETS-Stocks retreat as U.S. 10-year yields top 3 percent
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* Brent rises above $75 to highest since Nov 2014

* U.S. 10-year yield crosses 3 percent

* Tech earnings in focus

(Updates with U.S. market open, changes byline, dateline; previous LONDON)

By Chuck Mikolajczak

NEW YORK, April 24 (Reuters) - A gauge of world stocks dipped on Tuesday, relinquishing earlier gains after U.S. bond yields crossed the three percent threshold for the first time in four years, while oil prices stretched above the $75 per barrel mark.

Equities in Europe hit session lows and U.S. stocks lost ground after the U.S. 10-year Treasury yield US10YT=RR crossed the 3 percent mark to a high of 3.003 percent, its highest level since January 2014. In addition, the two-year yield US2YT=RR touched 2.5 percent for the first time since September 2008. 10-year notes US10YT=RR last fell 6/32 in price to yield 2.9939 percent, from 2.973 percent late on Monday.

The move higher in yields dampened the appetite for stocks, which had been higher on the back of a strong batch of earnings from names such as Verizon VZ.N , up 1.94 percent and Caterpillar (NYSE:CAT) CAT.N , up 2.88 percent.

"The market has to get used to the notion that this could be just another step in reversing a trend that has been in place in the market for nearly four decades," said Frank Cappelleri, technical market analyst and trader at Instinet in New York, referring to declining rates on bond yields.

"From my perspective, if this downtrend is going to break, this is the best chance of it over the last five years."

The pan-European FTSEurofirst 300 index .FTEU3 lost 0.23 percent and MSCI's gauge of stocks across the globe .MIWD00000PUS shed 0.16 percent.

MSCI's index has declined for three straight sessions, its longest losing streak in a month.

Gains on Wall Street were also hemmed in by a 4.93 percent drop in Google parent Alphabet GOOGL.O as strong growth in ad sales on search and YouTube were not enough to offset a surge in costs. kicked off a big week for tech sector earnings, with results expected from 23 names in the group including Facebook FB.O and Microsoft MSFT.O .

The Dow Jones Industrial Average .DJI fell 47.44 points, or 0.19 percent, to 24,401.25, the S&P 500 .SPX lost 6.32 points, or 0.24 percent, to 2,663.97 and the Nasdaq Composite .IXIC dropped 52.08 points, or 0.73 percent, to 7,076.52.

Chipmaker AMS AMS.S slumped 9.64 in Swiss trading after it reported first-quarter sales towards the lower end of its guidance range on Monday and warned of a downturn owing to weaker orders from one of its main customers. did not name the customer, but the Austrian company is a big supplier to Apple AAPL.O , making components for the iPhone.

U.S. earnings thus far have gotten off to the strong start that was expected, with the expected growth rate for the quarter currently at 21.1 percent, according to Thomson Reuters data. Of the 118 companies in the S&P 500 that have reported through Tuesday morning, 77.1 percent have topped expectations.

Brent crude oil prices, the global benchmark, rose above $75 a barrel LCOc1 to their highest level since November 2014, supported by OPEC-led production cuts, strong demand and the prospect of renewed U.S. sanctions on Iran. crude CLcv1 rose 0.16 percent to $68.75 per barrel and Brent LCOcv1 was last at $74.87, up 0.21 percent on the day.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Global CPI and Brent oil prices

https://reut.rs/2Jly5FI Global currencies vs. dollar

http://tmsnrt.rs/2egbfVh MSCI All Country Wolrd Index Market Cap

http://tmsnrt.rs/2EmTD6j

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