(Updates with early U.S. trading, changes dateline, previous
* Dow stumbles again at 20,000
* U.S. 10-year yield hits two-week low
* European banks weigh on stocks
NEW YORK, Dec 29 U.S. and European shares, the
dollar and bond yields all headed lower on Thursday, with
traders using the quiet holiday period to book some profits on
the heady gains stocks have seen in the final quarter of 2016
and reposition for the year ahead.
U.S. benchmark indexes were fractionally lower near midday
in the aftermath of the S&P 500's biggest drop in more
than two months a day earlier.
As in Europe, financial stocks, which have seen a tremendous
run since the U.S. presidential election on the back of higher
interest rates, were exerting the greatest downward pressure as
bond yields retreated further from their recent highs. U.S. and
European bank stocks both were down by more than 1 percent.
"It's really investor malaise," said Alan Lancz, president,
Alan B. Lancz & Associates Inc, an investment advisory firm in
Toledo, Ohio. "There's no strong activity either way, buy or
sell, and light volume."
"This past week, it's been the buyers pulling back and done
with their buying and the sellers have been hesitant, even since
the election, because they'd rather sell into 2017," Lancz said.
"So now you have no activity either way, really, and that's why
the volume has really dried up."
The stall on Wall Street put yet more distance between the
blue chip Dow Jones Industrial Average and the
much-vaunted 20,000 mark. The Dow has gained more than 8 percent
since Donald Trump's victory in the Nov. 8 U.S. presidential
election and has come to within 20 points of the milestone
repeatedly without successfully crossing the line.
In late morning U.S. trade, the Dow was down 0.01 percent at
19,832, the S&P 500 was off 0.03 percent at 2,249 and the Nasdaq
slid 0.2 percent to 5,427.
The yield on 10-year U.S. Treasury notes slipped to a
two-week low as the bond market sell-off fizzled, pulling the
dollar to a two-week low against the yen.
Europe's index of the leading 300 shares fell 0.5
percent. The yen's strength, along with a 17-percent slump in
Toshiba Corp's shares after news of potential massive
writedowns led to a downgrade to its credit ratings, contributed
to a 1.3-percent fall for the Nikkei.
MSCI's broadest index of Asia-Pacific shares outside Japan
was last up 0.45 percent, helping to keep global
stocks in positive territory with a slender 0.17-percent gain.
Euro zone bond yields were also falling on concerns about
the strength of a rescue plan for Italian banks and normal
Germany's 10-year yields hit their lowest in
seven weeks at 0.164 percent before recovering some ground,
after their discount to Treasury yields reached its widest on
record earlier in the week. The spread remained not far off that
mark on Thursday at 2.31 percentage points, and the U.S. 10-year
yield slipped back below the key 2.50 percent mark,
retreating further from a two-year high above 2.60 percent in
The dollar eased by 0.6 percent against the yen to 116.55
, while sterling recovered from a two-month low to trade
0.3 percent higher at $1.2263. The euro was 0.7
percent stronger against the greenback.
In commodity markets, oil was mixed after data showed a
surprise build in U.S. crude inventories. U.S. crude fell
0.2 percent to $53.95 a barrel, while Brent was last
down 0.04 percent at $56.20.
(Reporting by Dan Burns; Additional reporting by Jamie McGeever
in London; Editing by Nick Zieminski)