* U.S. 10-year Treasury yields fall to lowest since November
2016
* Symantec surges on reports of talks with Broadcom
* Dow up 0.67%, S&P 500 up 0.77%, Nasdaq up 0.75%
(Updates to market close, changes byline)
By Chuck Mikolajczak
NEW YORK, July 3 (Reuters) - U.S. stocks rose on Wednesday,
with each of the major indexes closing at a record high, as
expectations grew that the Federal Reserve would take a more
dovish turn as a raft of data provided more evidence of a
slowing economy.
Benchmark U.S. 10-year Treasury Note yields US10YT=RR
touched its lowest since November 2016 at 1.939%, while euro
zone yields tumbled to record lows on bets the European Central
Bank's next chief would stay a dovish course.
Data on Wednesday showed the U.S. trade deficit jumped to a
five-month high while services sector data showed a slowdown in
activity. The reports come on the heels of data on housing,
manufacturing, business investment and consumer spending that
point to slowing economic growth in the quarter. data has been mixed, it hasn't been terrible, sort of a
decline generally," said Thomas Martin, senior portfolio manager
at Globalt Investments in Atlanta, Georgia.
"Certainly the bond market is continuing to hit fresh yield
lows so that is a message there is a definite slowing and the
central banks will have to cut. I guess the equity markets are
saying that is going to be OK."
The Dow Jones Industrial Average .DJI rose 179.32 points,
or 0.67%, to 26,966, the S&P 500 .SPX gained 22.79 points, or
0.77%, to 2,995.8 and the Nasdaq Composite .IXIC added 61.14
points, or 0.75%, to 8,170.23.
The defensive utilities .SPLRCU , real estate .SPLRCT and
consumer staples .SPLRCS rose the most among the 11 major S&P
sectors as the falling bond yields made stocks that pay high
dividends more attractive. The dividend yield for the broad S&P
500 and the 10-year Treasury are nearly identical.
Traders currently see a 29.7% chance the Federal Reserve
would cut borrowing costs by half a percentage point at its July
30-31 policy meeting, up from the 25% perceived chance on
Tuesday and 24% a week ago. A cut of at least a quarter
percentage point is viewed as a certainty.
Rising expectations for a rate cut, fueled by softer
economic data and comments from global central banks indicating
a more dovish stance helped the S&P 500 and the Dow Jones
indexes post their best June performance in decades.
The Atlanta Fed on Wednesday trimmed its second-quarter GDP
growth view to 1.3% on an annualized rate, down from 1.5% on
Monday. Trading volumes were thin due to shortened trading hours on
Wednesday ahead of the July Fourth holiday. About 4.15 billion
shares changed hands in U.S. exchanges, compared with the 6.89
billion daily average over the last 20 sessions.
Additional data on the labor market showed the ADP National
Employment Report, considered by some to be a precursor to the
Labor Department's more comprehensive monthly nonfarm payrolls
data due on Friday, showed U.S. private employers added 102,000
jobs in June, well below economists' expectations. Among stocks, Symantec Corp SYMC.O surged 13.57%, the most
on the S&P, after sources told Reuters that chipmaker Broadcom
Inc AVGO.O is in advanced talks to buy the cybersecurity firm.
Broadcom fell 3.5%. Tesla Inc TSLA.O rose 4.61% after the electric carmaker
set a record for quarterly vehicle deliveries after months of
questions about demand for its luxury electric cars.
Advancing issues outnumbered declining ones on the NYSE by a
2.64-to-1 ratio; on Nasdaq, a 1.85-to-1 ratio favored advancers.
The S&P 500 posted 85 new 52-week highs and no new lows; the
Nasdaq Composite recorded 88 new highs and 40 new lows.
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