The S&P 500 ended above 2,100 at another record high on Tuesday as optimism grew that a debt deal would be reached with Greece and as bond prices sold off. In a possible sign of progress for Greece, a source told Reuters the country intends to ask for an extension of a loan agreement Wednesday. The report follows a collapse of deal negotiations on Monday, which led to European Union finance ministers pressuring the country to remain in an international financial rescue program.
Late in the session, though, broadcaster ZDF reported the German finance minister said an extension was not up for debate. U.S. Treasury debt prices sold off, pushing benchmark 10-year note yields to seven-week peaks, on expectations the Federal Reserve could bump up rates as early as June. Minutes from the last Fed meeting are due Wednesday.
“We’ve seen more of a risk-on trade,” said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama. “Because bonds are so low globally, it creates an interest in equities that perhaps the risk is worth taking to get the higher return.” Among the S&P 500’s biggest positives, shares of Medical device maker Medtronic Plc (MDT.N), which last month completed the $49.9 billion purchase of Ireland-based Covidien Plc, rose 3.7 percent at $78.07. Medtronic reported a better-than-expected third-quarter profit, driven by solid growth in its cardiac and vascular business.
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