Tech Stocks Fuel Equity Gains as Treasuries Fall: Markets Wrap
(Bloomberg) — Technology stocks led equity gains on Monday as spending plans by Microsoft Corp. underscored the sustained demand for artificial-intelligence infrastructure. Thirty-year Treasury yields rose to the highest since 2023.
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Nasdaq 100 futures advanced 0.7%, with chip heavyweights Nvidia Corp. and Advanced Micro Devices Inc. rising more than 2% in premarket trading. In Europe, the Stoxx 600 also edged higher, fueled by ASML Holding NV’s biggest daily gain since October. S&P 500 contracts were up 0.4%.
US stocks are set to for a second day of gains after ending the longest losing streak since April on Friday. Microsoft plans to spend $80 billion on data centers stoked interest, while Nvidia’s Taiwanese partner Hon Hai Precision Industry Co. reported faster-than-expected revenue growth.
Tech’s rebound “is a technical move after the year-end correction,” said Fares Hendi, portfolio manager for global equities at SG Prevoir in Paris. “Microsoft’s decision to raise capex in 2025 is probably helping momentum.”
Meanwhile, US Treasuries slumped as the market prepared for $119 billion of fresh government debt issuance this week. The 30-year rate climbed as much as four basis points to 4.85%, the most since November 2023, before a $58 billion sale of three-year notes on Monday.
The dollar pulled back for a second day. The yen was the sole loser among Group-of-10 currencies against the greenback. The Canadian dollar got a lift from a Globe and Mail report that Prime Minister Justin Trudeau is likely to announce his resignation as leader of the Liberal Party this week.
However, the gains in the loonie may be short-lived given the “bearish macro backdrop” for the currency, according to RBC Capital Markets.
In the US, Federal Reserve Governor Lisa Cook will speak at a conference on law and microeconomics at the University of Michigan. Her colleague Tom Barkin, the Richmond Fed President, suggested on Friday his preference was to keep rates restrictive for longer.
China maintained its support for the yuan with the daily reference rate after the currency slumped past a key level on Friday. Services sector activity in the world’s No. 2 economy expanded at the fastest pace since May, a private survey showed on Monday, signaling improving domestic demand after Beijing’s stimulus blitz.
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