U.S. Equity Markets Finished Mixed, 10-Year Yields Move Above 3 Percent in Relatively Quiet Sessions

The major U.S. equity indexes finished mixed on Friday. Investors said gains were kept in check after Bloomberg News reported that Trump told aides to proceed with slapping tariffs on the $200 billion worth in Chinese goods. But the price action suggests investors may be realizing that the trade negotiations are going to go on for a while. This is evident in the muted reaction to the news each day.

In the cash market, the benchmark S&P 500 Index settled at 2904.98, up 0.80 or +0.03%. The blue chip Dow Jones Industrial Average finished at 26154.67, up 8.68 or +0.03% and the tech-driven NASDAQ Composite closed at 8009.59, down 4.12 or -0.05%.

The indexes rose steadily throughout the week even after China said it was looking to seek permission from the World Trade Organization to inflict sanctions upon the U.S., and President Trump stated he was “ready to go” on hitting China with an additional amount of tariffs. However, tensions also eased a little at mid-week after the U.S. proposed a new round of trade talks with China in the near future.

U.S. Economic Reports

The Commerce Department said Friday retail sales edged up 0.1 percent last month, the smallest rise since February. But July’s figures were revised higher to show sales rising 0.7 percent instead of the previously reported 0.5 percent gain.

In other news, Import Prices were lower by 0.6%. The Capacity Utilization Rate came in slightly below expectations at 78.1% and Industrial Production rose 0.4% versus 0.3%. The previous month was revised upward to 0.4%.

A preliminary look at a University of Michigan report on September consumer sentiment show that Americans remain optimistic on employment and wages.

The university said sentiment hit 100.8 in September, up from 96.2 in August, the second-highest level of the year and second-strongest since 2004. Traders were looking for a reading of 96.6.

“Consumers anticipated continued growth in the economy that would produce more jobs and an even lower unemployment rate during the year ahead,” said Richard Curtin, chief economist for the Survey of Consumers.

U.S. Treasury Markets

Friday’s revision of July’s U.S. retail sales report and solid consumer sentiment helped propel the yield on the benchmark 10-year Treasury note to better than 3 percent on Friday for the first time since August

The yield on the 10-year Treasury note was 2.996 at the close, down from highs above 3 percent hit earlier in the session. The yield on the 30-year Treasury bond was up at 3.13 percent.r