By Alex Veiga
AP Business Writer
The Dow Jones Industrial Average climbed above 27,000 for the first time Thursday after a turbulent day on Wall Street left the market within striking distance of more milestones.
The S&P 500 was hovering just below its all-time high in late-afternoon trading. The benchmark index briefly rose above 3,000 for the second day in a row before an early rally lost some of its momentum.
The market lost ground after an auction of long-term U.S. government bonds failed to drive up prices. That pulled bond prices lower, driving the yield on the benchmark 10-year Treasury note to 2.13% from 2.06% late Wednesday, a big move.
“The markets were higher at the beginning of the day based on (Federal Reserve Chairman Jerome) Powell’s testimony and him confirming what the futures markets have been telling us for a whole month: That we were going to get a rate cut,” said Randy Frederick, vice president of trading & derivatives at Charles Schwab. “But then we had this Treasury auction, which apparently didn’t go so hot.”
The surge in bond yields marks a reversal from recent weeks, when many investors funneled money into bonds and other less-risky assets amid growing anxiety over the U.S. trade conflicts and signs of a slowing global economy.
The move had a swift effect on sectors on real estate stocks, utilities and other high-dividend stocks that lose their appeal when bond yields rise.
Banks led the market higher, benefiting from the surge in bond yields. When bond yields climb, they push up the interest rates that lenders charge for mortgages and other loans, making them more profitable. Bank of America rose 1.5% and Goldman Sachs gained 2.5%.
Technology stocks, retailers and industrial companies also helped lift the market.
The S&P 500 rose 2 points,