US stocks closed lower on Tuesday as investors awaited details onBiden’s planned infrastructure spending package. The Washington Post reports that the first part of President Joe Biden’s infrastructure package will come in at $2.25 trillion, and contain funding for initiatives including broadband, highways, and housing. Biden will announce details on the first part of the package on Wednesday.
The 10-year Treasury yield surpassed 1.7% on Tuesday, hitting a new 14-month high as investors price in expectations of higher inflation and a stronger US economy amid Biden’s new multi-trillion spending plan and the COVID-19 vaccine rollout.
The US Consumer Confidence index soared to 109.7 in March from 90.4, far above the consensus, 96.0. It’s the largest one month gain since 2003, according to Pantheon’s Ian Shephardson.
“The index is still short of its pre-Covid trend, about 130, but it is no longer massively adrift. A combination of the latest stimulus payments and the much better Covid picture likely explains the surge in confidence,” said the chief economist.
Here’s where US indexes stood after the 4:00 p.m. ET close on Tuesday:
Wells Fargo jumped as much as 4% on Tuesday after it said it suffered no losses related to its exposure to Billy Hwang’s Archegos Capital. Though Japanese firm Nomura Holdings said it could suffer a possible loss of around $2 billion, while Credit Suisse Group, which has declined to provide a numerical impact, could see around $3 billion-$4 billion in the fallout, according to reports. JPMorgan estimated today that banks could face up to $10 billion in losses stemming from the liquidation of Archegos.
Gold prices dropped below $1,700 for the first time in three weeks, under pressure as long-dated Treasury yields and the US dollar rose on expectations that President Joe Biden’s infrastructure plan will cost multiple trillions of dollars.
The precious metal dropped 1.8% to $1,683.50 per ounce.
West Texas Intermediate crude fell by 1.97%, to $60.34 per barrel. Brent crude, oil’s international benchmark, was down 1.66% to $63.90 per barrel.