THE WALL STREET JOURNAL. **** Friday, November 8, 2019 |B11
Wall Street analysts are
swiping right on Tinder parent
Match GroupInc.
Shares of the company,
whose portfolio of dating plat-
forms includes Hinge and
Match.com, slid Wednesday af-
ter its outlook for the current
fiscal quarter left investors dis-
appointed. But after a string of
bullish analyst notes, the stock
rebounded—finishing Thursday
up 4%, compared with the S&P
500, which rose 0.3%.
The bull case for online dat-
ing? There is little sign demand
for it is fading. The number of
users active seven days a week
on Tinder soared 30% from a
year ago, according to UBS,
which bumped its rating for the
stock to “buy” from “neutral.”
Match has made strides in mar-
kets outside the U.S., like India,
said analysts at Nomura, who
kept their “buy” rating on the
stock. Match-owned OkCupid
launched its first marketing
campaign in India this year.
Competition among other
publicly traded companies also
looks scarce for now. Match
shares took a hit in early Sep-
tember when Facebook Inc.
said it was rolling out its dating
service in the U.S. But analysts
aren’t convinced users are
about to jump ship. The world
of online dating apps doesn’t
look like a “winner-take-all”
market, UBS said, adding that it
believes would-be daters drawn
to Match and Facebook come
from different demographic
groups anyway.BYAKANEOTANIthem, making them less ap-
pealing for yield-seeking in-
vestors when yields climb.
The Federal Reserve has in-
dicated it will pause interest-
rate cuts following its third
cut of the year, and some ana-
lysts expect an improving eco-
nomic outlook to continue to
boost bond yields and risky as-
sets, hurting precious metals.
At the same time, setbacks
in trade talks such as the ones
that stoked recession fearsearlier in the year could send
skittish investors back toward
havens, investors say.
Analysts will be monitoring
economic data points on Octo-
ber retail sales and industrial
production next week for the
latest gauge of U.S. growth.
Better-than-expected data on
third-quarter economic activ-
ity and October hiring have
also eased worries of an eco-
nomic downturn and hurt pre-
cious metals lately.Elsewhere in commodities
Thursday, U.S. crude-oil fu-
tures rallied 1.4% to $57.15 a
barrel on the New York Mer-
cantile Exchange, climbing
alongside stocks on hopes for
a trade agreement that would
lift fuel consumption.
Brent crude, the global
gauge of oil prices, added 0.9%
to $62.29 a barrel on the In-
tercontinental Exchange.
In another sign of improv-
ing risk appetite and bets on abrighter global-growth out-
look, front-month copper fu-
tures surged 2.4% to $2.7240 a
pound, extending a recent re-
bound and closing at their
highest level in 3½ months.
Some analysts use the indus-
trial metal’s price as a barom-
eter for the health of the
world economy because it is
crucial to manufacturing and
closely tied to China, which
accounts for roughly half of
global consumption.sparked hopes that the Federal
Reserve’s rate cuts are buoy-
ing the economy after several
months of uneven data. Inves-
tors, who began the year bet-
ting that policy makers would
cut interest-rates, are now wa-
gering that they hold rates
steady through next year.
The rise in yields on long-
term government debt in Eu-
rope comes as short-term
yields have remained negative,
thanks to additional stimulus
unveiled by the European Cen-
tral Bank in September.
“The fact that the yield
curve has been steepening in a
bond-market selloff has been
consistent with the market
discounting a better macro
outlook ahead,” said Stefano
Di Domizio, head of fixed-in-come trading strategy for Ab-
solute Strategy Research.
The most direct beneficiary
of the rise in yields has been
bank stocks, especially in Eu-
rope, where negative rates
have hit lenders hardest.
Lenders will potentially make
more money since their bor-
rowing costs tend to be tied to
short-term yields while they
lend at rates that are con-
nected to longer-term yields.
Individual European banks
have been among the best-per-
forming major stocks any-
where. Italy’s biggest bank
UniCreditSpA is up by nearly
one-quarter in the past month.
France’sSociété GénéraleSA
has risen 21% The Stoxx Eu-
rope 600 Bank Index overall
has rallied 12% over the pastmonth, outperforming the
broader market.
The financial sector has
been helped, in particular, by
rate cuts and the ECB’s Sep-
tember stimulus measures,
which included a fresh round
of asset purchases and cheap
lending to banks.
While rates have risen, they
are still low enough across the
region to encourage govern-
ments to borrow more and
spend on stimulus measures.
Some investors are hoping
such spending will keep econ-
omies from sliding back into
recession.
“If they don’t do it now, I
don’t see when they will do
it,” said Patrick Zweifel, chief
economist at Pictet Asset
Management.Wall Street
Falls Back In
Love With
Match
A recent rise in Treasury
yields threatens to undercut the
2019 rally in precious metals
such as gold and silver, high-
lighting how recent progress on
a trade agreement is pushing
investors to take on more risk.
Front-month gold futures
for November delivery fell 1.7%
to $1,464.20 a troy ounce on
the Comex division of the New
York Mercantile Exchange
Thursday, closing at their low-
est level since Aug. 2. Front-
month sil-
ver futures,
meanwhile
slid 3.3% to $16.97, their larg-
est one-day drop since late
September.
Gold is about 5.5% below its
six-year high hit in early Sep-
tember, and silver is down
more than 12% from its 2019
peak.
Optimism about a U.S.-
China trade deal has pushed
investors toward riskier cor-
ners of the market including
stocks and industrial commod-
ities, denting the appeal of ha-
ven assets including precious
metals and Treasurys.
China’s Commerce Ministry
said Thursday that the world’s
two largest economies have
agreed to lift some tariffs on
one another in stages if they
reach a partial trade deal,
boosting stocks around the
world.
Treasury yields also rallied,
pushing the yield on the
benchmark 10-year U.S. Trea-
sury note to 1.924%, its high-
est close since late July, from
1.814% a day earlier. Yields rise
as prices fall.
The rally in yields is a nega-
tive for precious metals be-
cause they offer no return to
investors simply for holding
BYAMRITHRAMKUMAR
Precious Metals Rally Faces New Threat
Front-month gold futures for November delivery fell 1.7% to $1,464.20 a troy ounce, closing at their lowest level since Aug. 2.CARLA GOTTGENS/BLOOMBERG NEWSCOMMODITIES
AUCTION RESULTS
Here are the results of Thursday's Treasury auctions.
All bids are awarded at a single price at the market-
clearing yield. Rates are determined by the difference
between that price and the face value.
FOUR-WEEK BILLS
Applications $145,968,368,900
Accepted bids $55,021,978,400
" noncompetitively $1,573,357,500
" foreign noncompetitively $100,000,000
Auction price (rate) 99.880611
(1.535%)
Coupon equivalent 1.562%
Bids at clearing yield accepted 81.05%
Cusip number 912796WH8
The bills, dated Nov. 12, 2019, mature on Dec. 10, 2019.
EIGHT-WEEK BILLS
Applications $112,500,311,800
Accepted bids $40,015,954,300
" noncompetitively $264,949,400
" foreign noncompetitively $100,000,000
Auction price (rate) 99.762000
(1.530%)
Coupon equivalent 1.559%
Bids at clearing yield accepted 71.47%
Cusip number 912796WM7
The bills, dated Nov. 12, 2019, mature on Jan. 7, 2020.
30-YEAR BONDS
Applications $51,415,791,000
Accepted bids $27,996,676,000
" noncompetitively $14,299,800
" foreign noncompetitively $0
Auction price (rate) 98.833264
(2.430%)
Interest rate 2.375%
Bids at clearing yield accepted 51.75%
Cusip number 912810SK5
The bonds, dated Nov. 15, 2019, mature on Nov. 15,
2049.
Still, stocks retreated from
their intraday highs after media
reports suggested that U.S. offi-
cials hadn’t agreed with the
tariff-rollback plan.Hurdles, such as intellectual-
property protections for U.S.
companies operating in China,
still confront the U.S.-Chinese
trade negotiations. Much of theMARKETS
the past two weeks, China and
the U.S. agreed to remove tar-
iffs at the same time and by the
same proportion when they
sign the initial accord, a Chi-
nese Commerce Ministry
spokesman said Thursday. He
described recent talks as “care-
ful and constructive.”
The yield on 10-year Trea-
surys rose to 1.924%—its high-
est close since July—from
1.814% Wednesday, as investors
sold U.S. government debt,
seen as a haven asset.
Gold, another haven, fell
1.7% to $1,464.20. a troy ounce.
U.S. crude-oil futures gained
1.4% to $57.15 a barrel on ex-
pectations economic growth
would drive energy demand.
“The economy is solid, with
no sign of inflation, and geopo-
litical issues seem like they may
be improving,” said Dan Miller,
director of equities at GW&K
Investment Management. “It
just feels like everything is
moving in the right direction.”recent optimism has focused on
a limited “phase one” trade
deal, which would set aside
some of the thornier issues in
the trade dispute.
Investors also continued to
face fresh quarterly earnings
reports Thursday.
Shares ofQualcommrose
$5.35, or 6.3%, to $89.98 after
the chip maker signaled a
strong year ahead for 5G phone
sales.
Ralph Lauren jumped
$14.79, or 15%, to $115.67, mak-
ing it the best performer in the
S&P 500, after the fashion
house’s quarterly results beat
consensus expectations.
Among Thursday’s under-
performers, online travel site
Expedia tumbled $37.07, or
27%, to $98.29, while its rival
TripAdvisorfell $9.14, or 22%,
to $31.65, after their earnings
fell short of forecasts. Both
companies cited difficulties in
getting their listings to rank
high in Google’s search results.Roku, which makes stream-
ing-media devices that has
been an investor darling this
year, fell $22.59, or 16%, to
$118.46 after it issued a disap-
pointing outlook for fourth-
quarter revenue growth.
Party Cityplunged $4.10, or
67%, to $2 after the party-sup-
plies retailer reported a year-
on-year decline in Halloween
sales and continuing negative
impacts from a global helium
shortage.
Of the 430 companies in the
S&P 500 that have reported
earnings through Thursday
morning, nearly three-quarters
have beaten analyst expecta-
tions, according to Refinitiv.
The Stoxx Europe 600 rose
0.4%. In Asia, the Hang Seng In-
dex climbed 0.6% in its sixth
consecutive session of gains. At
midday Friday in Tokyo, the
Nikkei was up 0.1%, the Hang
Seng was down 0.4% and the
Shanghai Composite was up
0.3%.U.S. stocks climbed as signs
of progress in trade talks with
China fueled investors’ appetite
for riskier assets.
The Dow Jones Industrial
Average gained 182.24 points,
or 0.7%, to 27674.80. The S&P
500 advanced
8.40 points, or
0.3%, to
3085.18, while
the tech-heavy Nasdaq Com-
posite was up 23.89 points, or
0.3%, to 8434.52.
The Dow and S&P closed at
records, while the Nasdaq was
within 0.01% of the record it set
this week.
Stocks have been lifted by a
resilient U.S. economy, a series
of interest-rate cuts by the Fed-
eral Reserve, hopes that the
trade war with Beijing is mov-
ing toward resolution and
strong corporate earnings.
Following negotiations over
BYALEXANDEROSIPOVICH
ANDCAITLINOSTROFF
Dow Jumps 182 Points on Trade Progress
Two-day index performanceSources: FactSet (indexes); Tullet Prebon (yield)1.0–1.0–0.500.5%Wed. Thurs.Nasdaq
CompositeS&P500DJIA10-year Treasury yield
2.01.61.71.81.9%Oct.27 Nov.1 7THURSDAY’S
MARKETS
U.S. Sets Debt Sales
The Treasury Department will
auction $87 billion in securities
next week. Details (all with mini-
mum denominations of $100):
Tuesday:$45 billion in 13-
week bills, a reopening of an is-
sue first sold on Aug. 15, 2019,
maturing Feb. 13, 2020. Cusip
number: 912796TF6.
Also, $42 billion in 26-week
bills, dated Nov. 14, 2019, due
May 14, 2020. Cusip: 912796TV1.
Noncompetitive tenders for
both issues must be received by
11 a.m. EST Tuesday and com-
petitive tenders, by 11:30 a.m.
The total amount of nega-
tive-yielding debt world-wide
fell to about $12.5 trillion, ac-
cording to Deutsche Bank Se-
curities, from a peak of $17
trillion in August.
Meanwhile, yields on 10-
year German bunds, while still
negative, hit their highest
level since the middle of June,
according to Tradeweb data,
yielding minus-0.245% on
Thursday. The yield on compa-
rable Irish debt reached
0.136%, its highest level since
July 30.
“Multiple markets are con-
firming what could be a re-
gime change in sentiment,”
said Donald Ellenberger, who
manages multisector strate-
gies at Federated Investors.
Hopes of an initial trade
deal between the U.S. and
China this week help the out-
look for Germany’s export-de-
pendant economy—the euro-
zone’s largest—in particular,
investors say.
Economic data out this
week showed German factory
orders rose 1.3% in September
on the back of strong demand
at home and beyond the euro-
zone.
And the composite purchas-
ing managers index for the eu-
rozone, which covers manufac-
turing and services activity,
was raised to 50.6 from 50.2
for the month of October. A
level above 50 signals expan-
sion.
In the U.S., last week’s ro-
bust employment reportA surge in government-
bond yields world-wide car-
ried the yield on the bench-
mark 10-year Treasury note to
its highest close in three
months on Thursday, as signs
of further progress in trade
negotiations between the U.S.
and China stoked investor op-
timism.
The yield on the benchmark
10-year Treasury note settled
at 1.924%, according to
Tradeweb, rising
from 1.814% on
Wednesday to its
highest close
since late July. Yields rise as
bond prices fall.
In Europe, negative yields
on some long-term govern-
ment bonds—which had
alarmed investors when they
proliferated earlier in the
year—faded amid evidence
that easier monetary policy
and potentially constructive
political developments may
have helped the world’s big-
gest economies dodge a major
growth slowdown.
The yield on 10-year bonds
issued by the French and Bel-
gian governments turned posi-
tive Thursday for the first
time since mid-July.
Other European countries
that experienced negative
long-term rates for the first
time, including Ireland, Spain
and Portugal, have also re-
turned to positive territory in
recent weeks.BYAVANTIKACHILKOTITreasury Yield Hits Highest Level Since July
CREDIT
MARKETSYields on 10-year
government bondsStoxx Europe 600 index
and key sectorSources: Tullett Prebon (bonds); FactSet (stocks)IrelandBankingsectorStoxxEurope600France
BelgiumGermany0.50–0.75–0.50–0.2500.25%June Nov.120246810%Oct. 10 Nov. 1