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U.S. Treasury yields hit lowest since late 2017, global stocks fall

Published 2019-03-25, 04:26 p/m
© Reuters.  U.S. Treasury yields hit lowest since late 2017, global stocks fall
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* U.S. 10-year note yield dips below 2.4 percent

* Global stock gauge hits near two-week low, Wall St mixed

* Apple shares fall after unveiling of streaming video service

* Gold hits 3-week high as growth fears lift safe-haven appeal (Updates with close of U.S. trading)

By Lewis Krauskopf

NEW YORK, March 25 (Reuters) - Benchmark U.S. Treasury debt yields fell to their lowest since late 2017 on Monday and a gauge of world stocks dropped for a second straight session on persistent concerns over global economic growth.

The 10-year U.S. Treasury yield fell below 2.4 percent for the first time since December 2017. Germany's benchmark 10-year bond yield slid back into negative territory. gauge of stocks across the globe .MIWD00000PUS shed 0.46 percent, after it posted on Friday its biggest one-day drop in about three months. Wall Street's main indexes ended little changed during a choppy session after falling sharply on Friday.

Investors were still digesting weak U.S. factory data last week that prompted an inversion of the U.S. Treasury yield curve, which is widely seen as an indicator of an economic recession.

"The big story is bond yields," said Willie Delwiche, investment strategist at Baird in Milwaukee.

"You are at a point now where a drop in yields isn't being perceived as being a good thing for stocks... The thinking is, yields are dropping because the economy is weakening and that's not a good thing for stocks,” Delwiche said.

On Wall Street, the Dow Jones Industrial Average .DJI rose 14.51 points, or 0.06 percent, to 25,516.83, the S&P 500 .SPX lost 2.35 points, or 0.08 percent, to 2,798.36 and the Nasdaq Composite .IXIC dropped 5.13 points, or 0.07 percent, to 7,637.54.

Apple AAPL.O shares fell 1.2 percent, weighing on indexes, as the company unveiled a streaming video service. pan-European STOXX 600 index .STOXX lost 0.45 percent, its fourth straight drop.

In one economic bright spot, a survey showed German business morale improved unexpectedly in March after six consecutive drops. U.S. 10-year notes US10YT=RR last rose 12/32 in price to yield 2.414 percent, from 2.455 percent late on Friday. The yield fell as low as 2.377 percent.

On Friday, the spread between yields on three-month Treasury bills US3MT=RR and 10-year notes fell below zero for the first time since 2007. Such an inversion is a warning sign about the economy.

Investors were evaluating last week's dovish pivot by the U.S. Federal Reserve, in which the central bank stunned investors by abandoning projections for any interest rate hikes this year.

The dollar index .DXY , which measures the greenback against a basket of currencies, fell 0.12 percent, with the euro EUR= down 0.01 percent to $1.1311.

U.S. crude CLcv1 settled down 0.4 percent at $58.82 a barrel, while Brent LCOcv1 settled at $67.21, up 0.3 percent on the day. prices rose to a more than three-week high, helped by a weaker dollar and as worries over global economic growth pushed investors into safe-haven assets. gold XAU= added 0.7 percent to $1,322.21 an ounce.

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