The U.S. equity markets saw solid gains in today’s session, rebounding from last week’s dip, with technology and industrial issues leading the way, as trade concerns were tempered after China and the U.S. decided to suspend tariffs after a second round of trade talks. M&A activity dominated the equity front, headlined by Dow member GE’s agreement to merge its transportation unit with Wabtec. Treasury yields were modestly higher amid a dormant economic calendar and crude oil prices gained ground, while gold dipped and the U.S. dollar was flat.

The Dow Jones Industrial Average (DJIA) jumped 298 points (1.2%) to 25,013, the S&P 500 Index gained 20 points (0.7%) to 2,733, and the NASDAQ Composite rose 40 points (0.5%) to 7,394. In moderate volume, 711 million shares were traded on the NYSE and 1.9 billion shares changed hands on the NASDAQ. WTI crude oil traded $0.98 higher to $72.35 per barrel and wholesale gasoline was up $0.03 at $2.26 per gallon. Elsewhere, the Bloomberg gold spot price ticked $0.40 lower to $1,292.64 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—was unchanged at 93.64.

Treasuries were mostly lower amid an economic calendar void of any major releases today, as the yield on the 2-year note rose 2 basis points (bp) to 2.56%, the yield on the 10-year note ticked 1 bp higher to 3.06%, while the 30-year bond rate was flat at 3.20%.

The yield on the 10-year note sits at levels not seen since 2011 and the U.S. dollar took a slight respite from its recent move to the upside, amid resurfaced Fed rate hike expectations as the economic and earnings fronts remain solid. The stock markets have been choppy, dipping last week on the heels of a prior week rally.

Schwab Center for Financial Research – Market Analysis Group

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