Global stocks fall amid uncertainty in Washington and terror in Spain
NEW YORK - U.S. stocks rebounded in a volatile session on Friday, while the U.S. dollar cut losses and bond yields rose to session highs, as reports emerged U.S. President Donald Trump fired his controversial chief strategist Steve Bannon.
President Donald Trump fired chief strategist Steve Bannon on Friday, the White House announced, ending the turbulent tenure of a rabble-rousing conservative media entrepreneur and political activist who was a darling of Trump's base.
"There’s a lot of hopeful people thinking that, you know what, he has been a divisive figure in the White House," said Peter Costa, President of Empire Executions. "Getting rid of him might be a good deal for the president.”
Gold turned negative after the reports, which seemed to turn investor focus away from uncertainty over Trump policy and nerves over terrorist attacks in Spain.
Trump has alienated Republican colleagues, corporate leaders and overseas allies this week with several controversial comments after violence related to a white nationalist protest in Virginia last weekend.
His criticism of removals of U.S. Confederate monuments that celebrate defenders of slavery sent shivers through markets as investors bet that the stance would hurt Trump's ability to build enough consensus to deliver growth boosts such as tax reform and stimulus spending.
"It appears they've gotten so bogged down in the politics of Confederate monuments, everybody thinks they're incapable of delivering meaningful change," said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland.
Months of relatively low volatility did not help.
"We've been overly complacent for an extended period of time, and the normal anxieties in the market are beginning to reawaken," said McCain.
The Dow Jones Industrial Average rose 20.73 points, or 0.1 per cent, to 21,771.46, the S&P 500 gained 7.13 points, or 0.29 per cent, to 2,437.14 and the Nasdaq Composite added 26.79 points, or 0.43 per cent, to 6,248.70.
U.S. consumer sentiment rebounded in early August from an eight-month low in July, reflecting confidence in the economic outlook and personal finances.
The dollar index fell 0.13 per cent, with the euro up 0.25 per cent to US$1.1752.
The Japanese yen strengthened 0.10 per cent versus the greenback at 109.48 per dollar. The dollar had hit its lowest point in a week against the yen earlier in the session.
Benchmark 10-year notes last fell 3/32 in price to yield 2.2062 per cent, from 2.197 per cent late on Thursday.
Spot gold dropped 0.1 per cent to US$1,285.97 an ounce to the highest since last November and on track for its second week of gains.
Oil prices rose as the stock market strengthened and the U.S. dollar weakened, though investors remained worried about the global oil glut.
U.S. crude rose 2.8 per cent to US$48.41 per barrel and Brent was last at US$52.59, up 3.06 per cent on the day.
The pan-European FTSEurofirst 300 index lost 0.73 per cent and MSCI's gauge of stocks across the globe shed 0.08 per cent. Investors had reacted a terrorist attack in Barcelona by selling shares in airlines. Madrid shares fell 0.8 per cent.