STOCKS FALL, BONDS PLUNGE: Here's what you need to know

The Dow Jones Industrial Average opened at an all-time high, extending its post-election rally, before losing grip of its gains and closing little-changed.

Global bonds sold off again, sending Treasury yields to their highest levels of this year as investors continued to bet that President-elect Donald Trump’s fiscal policy will boost inflation.

And, the US dollar index, which measures the currency against a basket of other majors, rose above 100 for the first time since December.

First, the scoreboard:

  • Dow: 18,867.93, +20.27, (0.11%)
  • S&P 500: 2,164.24, -0.21, (-0.01%)
  • Nasdaq: 5,218.21, -18.90, (-0.36%)
  • 10-year Treasury yield: 2.228%, +0.110
  1. Mexico’s markets are still getting rocked. The peso fell against the dollar and the 10-year bond weakened more on Monday, nearly one week after Trump won the election. The IPC stock market index gained 1% in its first rally since election Tuesday. Trump’s proposals to tighten US trade and immigration with Mexico were considered negative for the country’s markets, which had been pressured by domestic economic concerns before the election.
  2. Cigarette-seller Reynolds American has rejected British American Tobacco’s $47 billion buyout offer. –Bloomberg reported that the US company is seeking a higher price, and BST is willing to slightly increase its offer. BAT holds a 42% stake in the company.
  3. Siemens is buying the semiconductor-design software company Mentor Graphics for $37.25 a share in cash, or about $4 billion. That’s a 21% premium to Mentor’s closing price Friday, and it values the Oregon-based company at about $4.5 billion, including debt. “It’s a perfect portfolio fit to further expand our digital leadership and set the pace in the industry,” said Siemens CEO Joe Kaeser a statement.
  4. Trump’s advisers reportedly have ex-Goldman Sachs banker Steven Mnuchin as the top pick for Treasury secretary. Bloomberg reported that Trump’s transition team recommended the Goldman banker of 17 years. Mnuchin also worked briefly for George Soros.


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