US stocks rise to to all-time highs and treasuries rally

New York — Major US indexes rose to all-time highs in thin trading ahead of a holiday and the rally in global bonds extended as investors weighed the prospect of more dovish appointees to two of the world’s major central banks.

The Dow Jones Industrial Average notched its first record since October, while the S&P 500 climbed a fifth day to extend its high. Futures on the broader index briefly topped 3,000 for the first time. The Nasdaq indexes rose past closing records set in early May.

Stock investors piled into high dividend-yielding sectors like utilities and REITs after 10-year treasury yields dipped to the lowest since November 2016 on rising market bets that the Federal Reserve will cut rates in July. Markets closed at 1pm ahead of the July 4 holiday.

“We’ve seen continued doubt and worry over this bull market for a decade now, yet it continues to defy all sceptics,” said Ryan Detrick, senior market strategist for LPL Financial. “The bottom line is the dual benefit of both fiscal and monetary policy should help extend this business cycle potentially much longer than many expect.”

The dollar fell after jobless claims came in broadly as forecast and private hiring numbers missed expectations. A reading on the services sector fell to the lowest since 2017, but Wednesday’s batch of data did little to move markets, with jobs numbers coming on Friday. The euro erased a small drop as purchasing manager data for the region was revised slightly higher.

Europe’s leaders have nominated Christine Lagarde to take the helm of the ECB later in 2019, ushering in a candidate analysts expect will take up departing president Mario Draghi’s mantle in providing stimulus.  US President Donald Trump said he was  planning to nominate Christopher Waller and Judy Shelton to serve on the Fed Board, candidates both seen as likely to advocate lower interest rates.