Stocks mixed amid Fed warnings on the economy

Stocks were mixed amid warnings from Federal Reserve officials on the need for more stimulus to lift the economy from a coronavirus-induced recession.

Fed Vice Chairman Richard Clarida reiterated that U.S. central bankers think “additional fiscal support will likely be needed” to support the recovery. The S&P 500 was little changed, while the Nasdaq 100 retreated. Tesla Inc. plunged as its highly anticipated “Battery Day” event fell short of expectations. Nike Inc. rallied after the sportswear maker posted far better revenue than predicted. Johnson & Johnson jumped as it began the first big U.S. trial of a Covid-19 vaccine that may work after just one shot. The dollar headed for its longest winning streak since June.

Fed Chairman Jerome Powell will appear before the House Select Subcommittee on the Coronavirus to discuss the central bank’s response at 10 a.m. Washington time. He reiterated Tuesday that the economy has a long way to go before fully recovering and will need further support. Traders will also sift through comments from several other central bank officials including Eric Rosengren from Boston, Mary Daly from San Francisco and Charles Evans from Chicago.

The U.S. House passed a stopgap funding bill to keep the government operating through Dec. 11 after both parties in Congress and officials at the White House struck a deal to provide aid to farmers and food assistance for low-income families. The decision sends the temporary spending bill to the Senate for a vote before the fiscal year ends on Sept. 30. Final passage would avert a government shutdown just before the Nov. 3 election.

These are some events to watch this week:

• U.S. initial jobless claims are due Thursday.

Here are some of the main moves in markets:

Stocks

• The S&P 500 was little changed as of 9:33 a.m. New York time.
• The Stoxx Europe 600 Index gained 1.3 per cent.
• The MSCI Asia Pacific Index was little changed.

Currencies

• The Bloomberg Dollar Spot Index increased 0.3 per cent.
• The euro fell 0.2 per cent to US$1.169.
• The Japanese yen depreciated 0.2 per cent to 105.19 per dollar.

Bonds

• The yield on 10-year Treasuries gained one basis point to 0.68 per cent.
• Germany’s 10-year yield rose less than one basis point to -0.50 per cent.
• Britain’s 10-year yield increased one basis point to 0.215 per cent.

Commodities

• West Texas Intermediate crude rose 0.4 per cent to US$39.97 a barrel.
• Gold depreciated 0.8 per cent to US$1,885.46 an ounce.
• Silver depreciated 3.5 per cent to US$23.54 per ounce.

–With assistance from Constantine Courcoulas, Adam Haigh, Todd White, Cecile Gutscher and Lynn Thomasson.