Daily Stock Market Update — March 28, 2019

Stock indexes notched modest gains on Wall Street as bond yields rose, easing concerns about a troubling drop in long-term yields over the past week and more in Thursday’s Stock Market Update.

“The markets are looking closely at bond yields, and the fact that bond yields have eased a little bit is a reason for the stock market to breathe a little easier today.”

Gains in technology, financial and industrial stocks outweighed losses in utilities and communications companies. Smaller company stocks outgained the broader market.

After a sharp rebound from a dismal end to 2018, the benchmark S&P 500 index is on track for the biggest quarterly gain since the third quarter of 2009. Still, investors remain anxious about the slowing global economy and worrisome signals coming from the bond market.

After falling sharply since Friday, the yield on the benchmark 10-year Treasury note rose Thursday to 2.39 percent from 2.37 percent late Wednesday. That remained below the yield on the three-month Treasury bill, an unusual phenomenon that has preceded recessions in the past.

“The markets are looking closely at bond yields, and the fact that bond yields have eased a little bit is a reason for the stock market to breathe a little easier today,” said Erik Davidson, chief investment officer at Wells Fargo Private Bank.

The rise in bond yields gave bank stocks a boost. Citigroup gained 1.7 percent. Higher bond yields are good for banks because they can earn more income from the bonds they hold and they can charge higher interest rates on loans.

Traders also welcomed solid quarterly results from several companies, including watch maker Movado Group, Calvin Klein parent company PVH, yoga wear retailer Lululemon Athletica and consulting company Accenture.

Verizon led the slide in communications services stocks, shedding 3.2 percent.

Investors also weighed new data showing the U.S. economy grew at a lower-than-expected rate in the fourth quarter.

Traders have their eye on several potential market-moving developments. The Chinese and U.S. trade negotiators were preparing for the latest round of talks aimed at ending a tariff war between the world’s two biggest economies. And in the United Kingdom, the countdown to Britain’s departure from the EU loomed Friday.

In addition, investors are looking ahead to the next corporate earnings season, which kicks into gear in mid-April.

STOCK MARKET UPDATE

KEEPING SCORE: The Dow Jones Industrial Average rose 91 points, or 0.4 percent, to 25,717 by closing time. The S&P 500 and Nasdaq composite gained 0.4 and 0.3 percent, respectively. The Russell 2000 index of smaller company stocks picked up 0.8 percent.

Major indexes in Europe finished mostly lower.

SLOWING ECONOMY: The Commerce Department said U.S. economic growth slowed sharply in the last three months of 2018 to an annual rate of just 2.2 percent, reflecting weakness in consumer spending, business investment, government spending and housing. Economists believe growth has slowed further in the current January-March quarter due to weaker growth prospects in China and Europe, the dampening effects on U.S. exports from the Trump administration’s trade battles and the waning boost from the 2017 tax cut and government spending.

The more downbeat outlook for economic growth has prompted the Federal Reserve to signal that it plans to keep its benchmark interest rate on hold this year.

TRADE TALKS: U.S. trade negotiators arrived in Beijing on Thursday for a new round of talks aimed at ending a tariff war over China’s technology ambitions. Chinese and U.S. officials have suggested that progress has been made toward resolving the conflict, which has disrupted trade in everything from soybeans to medical equipment.

The talks were to begin with a working dinner Thursday and last the entire day Friday. Chinese officials are expected to return to the U.S. in early April.

RIGHT ON TIME: Movado jumped 21.5 percent after the watch maker reported strong earnings in its last quarter.

A GOOD LOOK: Shares in PVH vaulted 14.4 percent after the parent company of Calvin Klein and other brands turned in solid quarterly results.

NOT A STRETCH: Lululemon Athletica climbed 14.9 percent after the athletic apparel retailer posted better-than-expected quarterly results and issued a positive outlook.

SOLID QUARTER: Accenture was the biggest gainer in the technology sector after the consulting company’s latest quarterly results topped Wall Street’s forecasts. The stock rose 5.2 percent.

ENERGY: Oil prices barely budged even after President Donald Trump tweeted that it is “very important that OPEC increase the flow of Oil.” Trump added that world markets are fragile and the price of oil is getting “too high.”

Benchmark U.S. crude fell 0.2 percent to settle at $59.30 a barrel. Brent crude, used to price international oils, closed little changed at $67.82 a barrel.

CURRENCIES: The dollar rose to 110.58 yen from 110.36 yen on Wednesday. The euro weakened to $1.1226 from $1.1263. The British pound fell to $1.3059 from $1.3262.