U.S. Stocks Fall From Records, Treasuries Flat

(Bloomberg) -

U.S. stocks fell for the first time this year as shares that serve as bond proxies tumbled on speculation interest rates will continue to rise. Treasuries turned higher in late trading after demand at a 10-year auction was robust and Canadian officials were said to see rising odds that the Trump administration will leave Nafta.

The S&P 500 index snapped a six-day rally that was the longest since October, with shares in utilities and real-estate firms leading declines. Chipmakers also slumped, while banks rallied on the prospect for higher rates. Canada’s dollar weakened and its two-year bonds surged on the trade-pact report. The 10-year Treasury yield ended little changed after a wild ride that took it toward 2.60 percent on reports that China is considering slowing purchases. Its descent from highs began after a measure of demand at the government auction showed plenty of appetite for the debt.

The Nafta news damped risk appetite in the U.S. afternoon, halting a comeback for stocks that began the day on the wrong foot thanks to the news out of China. The S&P 500 index hasn’t fallen this year, as investors speculate the American economy is poised to take off thanks to tax reform. Canadian officials, speaking Wednesday on condition they not be identified, said there’s an increasing likelihood Donald Trump will give notice about a withdrawal from Nafta, threatening the decades-old trade regime.

Here are some of the main events to watch for this week:

– U.S. inflation data are forecast to show price pressures remain muted for now, giving hawks little reason to argue for faster tightening.

– St. Louis Fed bank President James Bullard and head of the New York Fed Bill Dudley are among central bankers scheduled to speak.

– A reading on China’s money supply is expected in coming days.

– JPMorgan Chase & Co. and Wells Fargo & Co. are due to report earnings on Friday

These are the main moves in markets:

– The S&P 500 fell 0.1 percent to 2,748.27 at 4 p.m. in New York. It earlier fell as much as 0.6 percent before erasing that loss, only to turn lower on the Nafta news.

– Real-estate firms and utilities that act as rate proxies fell the most. Semiconductors also slumped.

– The Dow Jones Industrial Average fell 0.1 percent and the Nasdaq 100 index lost 0.2 percent.

– The Stoxx Europe 600 index fell 0.4 percent, the largest decrease in three weeks.

– The MSCI All-Country World index retreated for the first time in seven days.

– The Bloomberg Dollar Spot index fell 0.1 percent.

– The loonie sank 0.8 percent.

– The euro climbed 0.1 percent to $1.1948.

– The Japanese yen surged 1.1 percent to 111.42 per dollar, the strongest in more than six weeks on the largest jump in seven weeks.

– The yield on 10-year Treasuries was little changed at 2.55 percent.

– Britain’s 10-year yield climbed one basis point to 1.292 percent, the highest in almost six weeks.

– Gold futures increased 0.4 percent to $1,318.30 an ounce.

– West Texas Intermediate crude increased 0.8 percent to $63.47 a barrel, the highest in more than two years.