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GLOBAL MARKETS-Wall Street takes a breather, bond yield falls as focus points to Fed

By Stephen Culp

NEW YORK, Apr 6 (Reuters) – US stocks took a pause on Tuesday, near their closing highs the day before, as Treasury yields fell slightly and investors saw recent positive data, watching for economic outlook presented by the Federal Reserve.

* On Wall Street, stocks poised to benefit more from the reopening of the economy – cyclical, small cap, transportation – outperformed the general market.

* This suggests that market players are optimistic about an economic rebound – and corporate earnings – fueled by vaccine distribution, stimulus, and a robust infrastructure project being debated in Washington.

* “Investors are taking a breather in anticipation of earnings, and that’s a pattern we see in almost every earnings season,” said Oliver Pursche, president of Bronson Meadows Capital Management in Fairfield, Connecticut.

* “The economic picture has improved a lot in the last three months,” added Pursche. “There is a general feeling globally that things are improving and will do so quickly.”

* The Fed is expected to release the minutes of its latest monetary policy meeting on Wednesday, and market players will scrutinize them for changes to the US central bank’s economic outlook.

* At 1559 GMT, the Dow Jones Industrial Average was down 16.80 points, or 0.05%, at 33,508.68; the S&P 500 index rose 7.18 points, or 0.17%, to 4,085.18 units; and the Nasdaq Composite was up 61.80 points, or 0.47%, at 13,769.63 points.

* European markets returned to activity after the holiday on Monday, following Wall Street in reaching new record highs on data indicating a rapid economic recovery from the global health crisis.

* The pan-European STOXX 600 index improved 0.74% and the MSCI global equity measure was up 0.31%.

* Emerging market stocks were up 0.59%. MSCI’s broader index of Asia-Pacific equities excluding Japan closed 0.66% higher, while Japan’s Nikkei lost 1.30%.

* Bond yields fell, with a decline led by five-year notes and investors considered the scenario based on an earlier-than-expected monetary tightening scenario by the Fed too aggressive.

* The 10-year benchmark debt rose 16/32 in price, yielding to 1.6649%, from 1.72% on Monday, while the 30-year debt improved 26/32 in price, with a return of 2.3222 %, compared to 2.363% the day before.

* The dollar reversed early gains against a basket of six prominent currencies, extending a weak start to April for the greenback. The dollar index was down 0.65% and the euro was up 0.22% at $ 1.1837.

* The yen strengthened 0.39% to 109.77 per dollar, while the British pound lost 0.32% to 1.3852 dollars.

* Crude prices were up around 2%, driven by strong data from China, partially recovering from Monday’s losses at a time of high volatility in markets due to the pandemic.

* Spot gold rose 0.8% to $ 1,742.66 an ounce, hitting its highest level in more than a week thanks to a weaker dollar and lower bond yields.

(Edited in Spanish by Carlos Serrano)

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