(Updates after U.S. market open, changes byline, previous
* Trump 'State of the Union' address in focus
* French polls push yields lower
By Sinead Carew
NEW YORK, Feb 27 World stock markets and the
U.S. dollar fell on Monday while U.S. Treasury yields rose amid
investor caution ahead of a key speech by U.S. President Donald
The dollar fell ahead of Trump's State of the Union address,
during which he is expected to unveil details on pro-growth
policies including infrastructure spending.
"There is setting up for what people expect might be at
least a focus on things like fiscal stimulus and infrastructure
spending of some kind, that might actually boost risk and cause
yields to rise," said Aaron Kohli, an interest rate strategist
at BMO Capital Markets in New York.
U.S. 10-year Treasury notes were last down 7/32 in price to
yield 2.342 percent, from a yield of 2.317 percent late Friday.
Two-year notes US2YT=RR were last down 1/32 in price to yield
1.169 percent, from a yield of 1.145 percent late Friday.
The dollar was down 0.3 percent against a basket of
major currencies after Trump said Monday that tax reform details
would not be revealed until after the administration's proposal
Investors had hoped for "more clarity around tax reform
sooner rather than later" said Bipan Rai, senior macroeconomic
strategist at CIBC Capital Markets in Toronto.
At 11:25 a.m. ET, the Dow Jones Industrial Average
was down 5.62 points, or 0.03 percent, at 20,816.14, the S&P 500
shed 0.2 points, or 0.01 percent, to 2,367.14, while the
Nasdaq Composite added 1.63 points, or 0.03 percent, to
Europe's benchmark index of leading 300 shares fell
MSCI's benchmark world stock index slipped 0.03 percent
after it hit a record high Thursday.
A proposed 29 billion euro merger between the London Stock
Exchange and Deutsche Boerse to create
Europe's biggest stock exchange looked dead in the water due to
an inability to meet European antitrust demands. Shares in both
companies fell. The London Stock Exchange fell as much as 3
percent while Deutsche Boerse fell as much as 4 percent.
"The regulatory hurdles were always a risk, and with Brexit,
there are additional hurdles to clear that seem close to
insurmountable now," said Neil Wilson, senior market analyst at
MSCI's broadest index of Asia-Pacific shares outside Japan
fell 0.24 percent, while Japan's Nikkei fell
0.9 percent for its lowest close since Feb. 9 on
concerns that a stronger yen would crimp corporate earnings.
The Dow Jones Industrial Average scaled its 11th consecutive
record high on Friday, the longest such run since 1987, leading
some to suggest it could be prone for a correction.
In Europe, the focus was on France, where the latest polls
showed that centrist Emmanuel Macron would score a more
convincing victory over far-right and anti-euro Marine Le Pen in
the presidential election's runoff vote.
France's 10-year bond yield fell to a one-month low of 0.88
In commodities, Brent crude was up 0.3 percent at
$56.14 per barrel while U.S. West Texas Intermediate was
up 0.4 percent at $54.20 per barrel as a global supply glut
appeared to ease.
(Additional Reporting by Jamie McGeever and Dhara Ranasinghe;
Editing by Bernadette Baum)