Stocks mostly rise but Nasdaq falls; dollar backs off two-week high

By Caroline Valetkevitch

NEW YORK (Reuters) - Stock indexes mostly rose globally on Wednesday, although the Nasdaq ended lower for the second day, while the U.S. dollar eased off its highest in more than two weeks.

The Dow hit a record high and the S&P 500 ended up slightly, supported by gains in energy and other economically sensitive sectors including materials and financials. The S&P 500 energy index ended up 3.3%.

Investors were positioning themselves ahead of Friday's U.S. monthly jobs report, expected to show that nonfarm payrolls increased by 978,000 jobs last month.

Tony Rodriguez, head of fixed income strategy at Nuveen, said it was possible Treasuries could move if the data varies much from forecasts.

"It would have to be closer to 1.2 million (in jobs gains) to have the market really feel like growth is accelerating at a pace that's a little above what people expected coming into this," Rodriguez said.

The Dow Jones Industrial Average rose 97.31 points, or 0.29%, to 34,230.34, the S&P 500 gained 2.93 points, or 0.07%, to 4,167.59 and the Nasdaq Composite dropped 51.08 points, or 0.37%, to 13,582.43.

The Nasdaq's move followed sharp declines on Tuesday, when technology-related shares added to losses after U.S. Treasury Secretary Janet Yellen said rate hikes may be needed to stop the economy from overheating. Yellen later said she was not "predicting or recommending" a near-term rate hike.

On Wednesday, Peloton Interactive Inc shares fell 14.6% on its announcement to recall its treadmills amid reports of multiple injuries and the death of a child in an accident.

The pan-European STOXX 600 index rose 1.82% and MSCI's gauge of stocks across the globe gained 0.29%.

Upbeat earnings and business activity in Europe boosted stock prices there. Data showed euro zone business activity quickened last month, while the services industry returned to growth.

India's Nifty 50 was 0.8% higher as the central bank rolled out measures to support the coronavirus-ravaged economy.

The dollar was near flat following softer-than-expected U.S. economic data. U.S. private payrolls rose by the most in seven months in April, ADP data showed, as companies boosted production to meet a surge in demand amid massive government spending and rising vaccinations. But the 742,000 private jobs created fell short of the 800,000 jobs expected by economists in a Reuters poll.

A separate report showed services industry activity eased in April from a record level in March, likely due to shortages of inputs as demand surged, data from the Institute for Supply Management showed.

The dollar index fell 0.007%, with the euro down 0.07% to $1.2004.

In the U.S. Treasury market, yields drifted lower as inflation expectations leaped to multi-year highs even as Fed officials downplayed the risk of a big rise in inflation.

The benchmark 10-year yield was last down 1 basis point at 1.5819%, holding below a 14-month high of 1.776% reached on March 30.

Oil ended little changed after two days of gains despite a sharp drawdown in U.S. crude stocks. Brent crude rose 8 cents to settle at $68.96 a barrel, while U.S. West Texas Intermediate (WTI) crude eased 6 cents to settle at $65.63.

Spot gold added 0.5% to $1,787.57 an ounce. U.S. gold futures gained 0.29% to $1,784.10 an ounce.

(Additional reporting by Tom Arnold in London, Karen Pierog in Chicago, Shreyashi Sanyal and Sruthi Shankar in Bengaluru, and John McCrank and Laila Kearney in New York; Editing by Kim Coghill, Will Dunham, Mark Heinrich, Sonya Hepinstall and David Gregorio)

FILE PHOTO: The Wall St. sign is seen near the New York Stock Exchange (NYSE) in New York City, U.S., May 4, 2021. REUTERS/Brendan McDermid

FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville

FILE PHOTO: People walk through the lobby of the London Stock Exchange in London, Britain August 25, 2015. REUTERS/Suzanne Plunkett/File photo

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