(Bloomberg) — U.S. stocks were mixed after investors were whipsawed in part by volatile trading in high risk assets such as Bitcoin amid lingering concerns about the outlook for inflation. Oil rose for the first time in four trading sessions.
The S&P 500 closed little changed after erasing earlier gains when Philadelphia Fed President Patrick Harker said the central bank should speak about reducing bond buying sooner rather than later. The tech-heavy Nasdaq 100 finished lower, while the Dow Jones Industrial Average gained as investors shifted from growth to value favorites such as Boeing. Bitcoin resumed its selloff Friday after China reiterated a warning that it intends to crack down on cryptocurrency mining as part of an effort to control financial risks.
“For people to say Bitcoin shouldn’t influence equity prices on a short-term basis, that’s crazy,” said Tom Essaye, a former Merrill Lynch trader who founded “The Sevens Report” newsletter. “We live in a 24/7 market and at least in the short term, it’s run by algorithms and they all trade the same stuff. When you get a negative headline you’re going to see it all sell.”
European shares climbed earlier on prospects of easing lockdowns and as services data signaled a recovery. Asian shares were mostly higher, although they slipped in China.
Treasury yields were little changed and the dollar gained. Gold dropped from its highest level in more than four months.
China’s has long expressed displeasure with the anonymity provided by Bitcoin and other crypto tokens, and warned earlier in the week that financial institutions weren’t allowed to accept it for payment. China is home to a large concentration of the world’s crypto miners, programmers who use massive computing power to verify transactions on the blockchain.
The global economic revival, the risk of a significant pickup in inflation and Covid-19 flareups in some parts of the world continue to shape market moves. Stocks have been volatile this week, with speculative ardor cooling as minutes from the latest Fed meeting flagged the possibility of a debate at some point on scaling back stimulus measures. Still, better-than-forecast jobless claims data on Thursday buoyed sentiment.
“Inflation fears and concerns over the Fed tightening monetary policy appear to have eased,” said Fiona Cincotta, senior financial markets analyst at City Index. “The impact from the FOMC minutes where the Fed indicated its readiness to start talking about tapering asset purchases appears to have been short-lived.”
Elsewhere, oil trimmed its biggest weekly decline since March. In Europe, Cartier jewelry maker Richemont gained after posting sales that topped estimates.
Click here for the MLIV question of the day: How should markets price in an aging China?
Here are some key events this week:
Euro-area finance ministers and central bank chiefs hold an informal meeting. A larger group of EU finance ministers and central bank chiefs will meet May 22
These are some of the main moves in markets:
Stocks
The S&P 500 was little changed as of 4:01 p.m. New York timeThe Nasdaq 100 fell 0.6%The Dow Jones Industrial Average rose 0.4%The MSCI World index was little changed
Currencies
The Bloomberg Dollar Spot Index rose 0.2%The euro fell 0.3% to $1.2187The British pound fell 0.2% to $1.4155The Japanese yen fell 0.1% to 108.90 per dollar
Bonds
The yield on 10-year Treasuries was little changed at 1.62%Germany’s 10-year yield declined two basis points, more than any closing loss since May 4Britain’s 10-year yield was little changed at 0.83%
Commodities
West Texas Intermediate crude rose 3.1%, the most since April 14Gold futures fell 0.1% to $1,882 an ounce, ending a six-day winning streak
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