Stocks slip after US election rally, bond yields rise further, dollar climbs

Fri Nov 11, 2016 5:35pm EST
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By Chuck Mikolajczak

NEW YORK (Reuters) - Stocks on major world markets gave back some of the week's gains on Friday, while global bond yields rose for a fifth day, supporting the U.S. dollar but pressuring commodities and emerging markets.

Investors are anticipating that U.S. President-elect Trump's policies will include lower tax rates and more infrastructure spending to grow the economy, but at the expense of a wider fiscal deficit and inflation.

The Dow Jones industrial average .DJI ended at a record closing high of 18,847.66. The S&P 500 index .SPX slipped 0.14 percent to 2,164.45, weighed down by weakness in energy stocks as oil prices fell, but the benchmark index was up 3.8 pct for the week, as was the Nasdaq Composite .IXIC, its best week since 2011.

Since the election on Tuesday, equity sectors that have benefited include banks and pharmaceuticals which may see less regulation under a Trump administration, while technology stocks are seen threatened by anti-trust policies and possible disruption of global supply chains posed by more protectionist trade policies.

The S&P financials stock index .SPSY closed up 0.4 percent on Friday and up 11.3 percent for the week, the best weekly performance since May 2009.

The S&P healthcare stock index .SPXHC fell 1.5 percent on Friday but ended the week up 5.8 percent, its best week gain in over two years.

The Nasdaq biotechnology index fell 0.64 percent on Friday but ended the week up 10 percent, its best week since 2000.

"Wall Street is going to be watching a lot of (Trump's) appointments and policy announcements to see whether it validates the more optimistic tone we've seen in the markets in the past few days," said Alan Gayle, senior investment strategist and director of asset allocation at RidgeWorth Investments in Atlanta, Georgia.   Continued...

Traders work at their desks in front of the German share price index, DAX board, at the stock exchange in Frankfurt, Germany, November 10, 2016. REUTERS/Staff/Remote