U.S. Stocks Retreat After Rally as Spanish, French Bonds Advance

U.S. stocks retreated as data showing improving manufacturing growth was not enough to extend the best three-day rally since 2009 for the Standard & Poor’s 500 Index. Spanish and French bonds rallied as successful debt auctions tempered concern about Europe’s sovereign crisis.

The S&P 500 slipped 0.2 percent to close at 1,244.58 at 4 p.m. in New York following a 4.3 percent jump yesterday when six central banks took coordinate action to ease funding strains stemming from turmoil in European bond markets. The yield on France’s 10-year note dropped 29 basis points, the most since 1991, to 3.11 percent. Spain’s five-year yield tumbled 57 basis points to 5.29 percent. The euro was up 0.1 percent at $1.3461, paring an earlier 0.6 percent advance.