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GLOBAL MARKETS-Stocks fall from records, U.S. yields continue to climb

Published 01/12/2021, 05:55 AM
Updated 01/12/2021, 06:00 AM
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* House Democrats introduce article on second Trump
impeachment
* Dollar rises again, bitcoin tumbles as much as 21%
* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh

(Updates to U.S. stock market close)
By Rodrigo Campos
NEW YORK, Jan 11 (Reuters) - Stocks fell on Monday, slipping
from record highs, partly on caution over rising coronavirus
cases globally while elevated Treasury yields continued to
support the dollar, which touched its highest since December
against a basket of peers.
Worldwide coronavirus cases surpassed 90 million on Monday,
according to a Reuters tally. Stocks on Wall Street slipped ahead of the start of an
earnings season that arrives with equities at record highs, and
as House Democrats introduced an article of impeachment against
President Donald Trump. Rising coronavirus cases across Europe
and China dragged down commodity stocks.
The Dow Jones Industrial Average .DJI fell 89.28 points,
or 0.29%, to 31,008.69, the S&P 500 .SPX lost 25.07 points, or
0.66%, to 3,799.61 and the Nasdaq Composite .IXIC dropped
165.54 points, or 1.25%, to 13,036.43.
The pan-European STOXX 600 index .STOXX lost 0.67%.
With Asian stock markets also lower, MSCI's gauge of stocks
across the globe .MIWD00000PUS shed 0.77% after closing at a
record high on Friday.
Longer-term Treasury yields were at their highest since
March before new long-dated supply coming this week and on
speculation of more U.S. fiscal stimulus as Democrats will have
control of Congress and the White House. Expectations of a multitrillion-dollar stimulus plan and the
belief the Federal Reserve will not act to counter rising
interest rates, along with new Treasury supply are helping
yields rise, said Gennadiy Goldberg, an interest rate strategist
at TD Securities in New York.
Benchmark 10-year notes US10YT=RR last fell 11/32 in price
to yield 1.1443%, from 1.107% late on Friday.
The spread between the 2-year and 10-year Treasury yield
US2US10=TWEB brushed against 100 basis points to hit its
steepest since July 2017.
The climb in yields in turn offered some support to the
dollar, which rose to its highest in over two weeks against a
basket of currencies.
"While the USD may catch a bid on position-adjustment or
profit-taking after its recent weakness, a sustained recovery
will have to be accompanied by either a clear improvement in
recent yield trends or a positive U.S. growth shock," said Shaun
Osborne, chief currency strategist at Scotiabank.
The dollar index =USD rose 0.256%, with the euro EUR=
down 0.54% to $1.2152.
Morgan Stanley said it had moved to neutral from bullish on
emerging market currencies as its forecasts had been hit and
factors that kept the U.S. dollar on the back foot may not be
sustained.
The Japanese yen weakened 0.24% versus the greenback at
104.20 per dollar, while Sterling GBP= was last trading at
$1.3516, down 0.35% on the day.
Crude oil prices fell, hit by renewed concerns about global
fuel demand amid tough coronavirus lockdowns across the globe,
as well as the stronger dollar. O/R
"The renewed concerns about demand due to very high numbers
of new (COVID-19) cases and further mobility restrictions, plus
the stronger U.S. dollar, are generating selling pressure,"
Commerzbank analyst Eugen Weinberg said.
U.S. crude CLc1 recently fell 0.1% to $52.19 per barrel
and Brent LCOc1 was at $55.61, down 0.68% on the day.
Spot gold XAU= dropped 0.2% to $1,844.27 an ounce. Silver
XAG= fell 1.70% to $24.94.
Bitcoin BTC=BTSP last fell 9.98% to $34,362.43. At its
session low, the cryptocurrency fell 21% on Monday.


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GRAPHIC-Global assets http://tmsnrt.rs/2jvdmXl
GRAPHIC-Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
GRAPHIC-Emerging markets http://tmsnrt.rs/2ihRugV
GRAPHIC-MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
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