The New York Stock Exchange finished higher this Monday thanks to satisfactory quarterly results of companies and the expectation that the Federal Reserve will moderate its rate hike policy towards the end of the year.
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The Dow Jones thus gained 1.34% to 31,499.61 points, a maximum in a month and a half, the technological Nasdaq 0.86% to 10,952.61 units, and the S&P 500 1.19% to 3,797.34 points.
“US stocks gained ground, buoyed by the idea that the Fed is going to hit the brakes after next week’s (monetary policy) meeting,” Oanda’s Edward Moya summed up. After weeks of turmoil, Treasury bond rates stabilized on Monday.
The yield of the papers to 10 years was in 4.24% against 4.21% on Friday. However, the three-month rate, an indicator that accounts for short-term monetary policy anticipations, exceeded 4% for the first time in 15 years, thus aligning itself with the perspective of a 0.75 point rise scenario percentage of the central bank guideline rate to a range of 3.75%-4%.
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The PMI manufacturing index and the PMI for the services sector in the United States fell sharply. The industrial indicator stood at 49.9 points, below the level of 50 points that separates the expansion from the contraction of activity. These results support the thesis that the US economy is slowing down, which could prompt the Fed to modify the path of its interest rates.
On the other hand, the start of the quarterly earnings season is “less bad than the market expected” and that “fuels confidence” among investors, said Andy Kapyrin of Regent Atlantic. The market is expecting “this crucial week for tech to be a good one too,” with earnings releases from Microsoft and Alphabet on Tuesday, Meta on Wednesday and Amazon and Apple on Thursday.
Both Microsoft (+2.12%) and Alphabet (+1.47%) were sought after by investors on Monday. “For me, it’s a push in the opposite direction,” says Nick Reece of Merk Investments. In the medium term, the market “will fall back to its lows” for the year and “the economy is going to enter a recession next year,” he said. Twitter (+3.27% to $51.52) started a decisive week higher.
Millionaire Elon Musk has until Friday to complete the purchase of the social network. He signaled that investors favor a buy scenario, the blue bird network’s share price is close to Musk’s proposed price of $54.20 a share. Instead, Tesla, founded by Musk, gave ground (-1.49% to $211.25), and was among the few Nasdaq stocks to end negative.
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Chinese firms on Wall Street had a rough day following Chinese President Xi Jinping’s resumption of office on Sunday. Alibaba plunged 12.51% to $63.15; JD.com (-13.02%) and Pinduoduo (-24.61%) also fell.
The European stock markets closed this Friday in an uneven way, after knowing the results of the companies and the shocks of the interest rates.
The Paris stock market fell 0.85%, Milan lost 0.62%, Madrid fell 1.29% and Frankfurt 0.29%, but the London stock market rose 0.37%.
AFP
