• S&P 500, Dow industrials open near yesterday’s closing price
• Allergan jumped almost 30% in early trading on AbbVie takeover
• Gold rallied, bitcoin advanced and government bond yields slipped
U.S. stocks wavered in early trading Tuesday as investors turned to haven assets such as Treasurys and gold.
The Dow Jones Industrial Average and S&P 500 were around flat in the opening minutes of trading in New York. Shares of Allergan rose nearly 30% after AbbVie reached a deal to buy the company for more than $60 billion. The news prompted a 10% slide in AbbVie’s stock.
In Europe, the Stoxx Europe 600 index fell 0.1%, with French and German equities dragging down the benchmark. One of the few bright spots for investors was in Capgemini and smaller rival Altran Technologies: the stocks soared after the French companies agreed to merge, sending Altran shares up almost 22% while Capgemini advanced 7.4%.
Meanwhile, gold prices jumped to their highest level this year before paring back slightly to $1,426.10 a troy ounce. The precious metal has gained 13% so far in 2019.
Gold prices were rising because of “a positive cocktail of factors” from lingering global growth worries and U.S.-China trade tensions to escalating fears of a conflict between the U.S. and Iran, said Carsten Menke, a commodities analyst at Julius Baer.
“If you take everything together you have quite a bullish environment for gold. Then you have technical levels which have been broken like $1,380 or $1,400 and that’s why we’ve had such a sharp rally,” he said.
Bitcoin extended its gains, reaching a record for the past year as it again crossed the $11,000 threshold. The world’s most popular cryptocurrency has soared 35% this month, boosted in part by the unveiling of Facebook’s Libra digital currency for mainstream users last week.
In Asia, Japan’s Nikkei was down 0.4%, the Hang Seng in Hong Kong slipped 1.2% and China’s benchmark Shanghai composite fell 0.9%.
The yield on the 10-year U.S. Treasury note, which falls as the price rises, dropped to 2.013%, from 2.021% on Monday. U.S. markets are gearing up for a busy day of speeches from Federal Reserve policy makers Tuesday as they look for clues on the course of U.S. monetary policy.
Investors this week have also largely held back from making big moves as their focus has shifted to the G-20 summit in Japan due to begin on Friday. A planned meeting between President Trump and Chinese President Xi Jinping at the summit is seen as a potentially crucial moment in the trade dispute between the two nations.